Still An Uptrend : Deepak Mohoni

THEmarket was under pressure for most of last week, and it required a strong rally on Friday to restrict the Sensitive Index's loss to 1.46% or 233.22 points for the period. The Nifty ended 1.10% down, while the CNX Midcap Index finished little changed after gaining a modest 0.07%. Reliance Communications was the biggest winner among index stocks with a 10.1% gain. The other index stocks to go up included Maruti Suzuki, Hero Honda, Hindustan Unilever and Mahindra & Mahindra with gains falling between 8.8% and 4.6%.      Bharti Airtel was the biggest loser among index stocks with a 6.6% loss. The other index stocks to go down included Jaiprakash Associates, Bhel, Reliance Industries and Hindalco with losses falling between 5.6% and 3.8%.      HPCL was the biggest winner among the more heavily traded non-index stocks with a 13.3% gain. The other non-index stocks to go up included BPCL, Mphasis, McLeod Russel India, Petronet LNG, Unitech, IOC and Sasken Communication with gains falling between 13.2% and 7.3%. Selan Exploration was the biggest loser among the more heavily traded non-index stocks with a 9.5% loss. The other non-index stocks to go down included BGR Energy Systems, Voltas, IRB Infrastructure Developers, HDIL, Indiabulls Real Estate, Ruchi Soya Industries and United Spirits with losses falling between 6.8% and 5.5%.  INTERMEDIATE TREND  The market is still in the intermediate uptrend that started at the Sensitive Index's August 19 low of 14,684, despite falling for several days last week. The uptrend would end if the Sensitive Index were to drop below the same level of 14,684. The equivalent for the Nifty is 4,353 and that for the CNX Midcap is 5,692.      These levels will be replaced with those reached at the bottom of the current decline. That bottom is likely to turn out to be last week's low of 15,350 for the Sensitive Index, 4,575 for the Nifty and 6,000 for the CNX Midcap Index (figures rounded down).      A few global indices entered intermediate downtrends with last week's sell-off. Shanghai did not enter an uptrend at all when several other indices did, and had fallen to a three-month low last week.  LONG-TERM TREND  Our market's long-term (i.e. major) trend remains up. The longterm uptrends in most stocks are also stable, as of now. A close below the Sensitive Index's last intermediate bottom of 14,600 (rounded down) would suggest that the bull market is over.      The majority of global indices are also in major (long-term) uptrends at this time, and the bull market here is in keeping with the global trend.  TRADING & INVESTING STRATEGIES  Buying for longer-term investing should now be attempted only after the next intermediate downtrend develops and runs for a week or more. At the same time, existing portfolios should be held on to, and investors should be in no hurry to book profits or reduce exposure. Short-term traders should look for individual stocks with momentum on their side rather than sectors now. Steel stocks appear the most sluggish, though.  GLOBAL PERSPECTIVE  A few global markets are in intermediate downtrends now. The Hang Seng and the Shanghai indices are among those in downtrends. A majority of global indices are in major uptrends now, and it could be safely stated that we are in a global bull phase. It would take a fall below 8,000 for the Dow to go into a bear market.      The Sensitive Index gained 3.8% in the twelve months that ended on Thursday, down eight positions to 11th place among 35 well-known global indices considered for the study.      Shanghai continues to head the list with a 24.9% gain. Turkey, Chile, South Korea and Indonesia follow. The Dow Jones Industrial Average has lost 16.5% and the NASDAQ Composite has lost 12.2% over the same period. (These rankings do not take exchange rate effects into consideration) (The author is an independent technical analyst)