Market Outlook 12/06/08

Will it be another bull trap now...!

Inaterestingly indian market was in bullish mode yesterday and even closed near to resistance level of 4540.The Reserve Bank of India (RBI) has hiked the repo rate by 0.25 percent to 7.75 percent, keeping the reverse repo rate unchanged at 6%.The Bank rate and the cash reserve ratio are left unchanged at 6% and 5% respectively.Moreover crude oil again went up to at $136.38 and dow fell 200 points yesterday.Swelling demand from China and other developing countries has boosted oil prices nearly 40 percent so far this year, pressuring major consumers like the United States that are already struggling to cope with a housing slowdown and credit crunch.Representatives of the world's biggest oil consumer and producer nations will meet in Saudi Arabia on June 22 to discuss soaring oil prices, which producer group OPEC says are due to speculation, not a lack of supply.So, all these negative news will effect to indian market also and for today, if nifty fails to cross 4540, it will be straight fall and lower side support will be at 4475 and then 4435 and lastly 4370 strongest support.Even if nifty moves above 4540, higher level selling will come strongly. Incase, if there is lower opening, pullback is possible again if 4370 is held.

Stock watch for the day:

LITL (353): Short this stock at higher levels with stop loss 364 for lower target 345-338