Investors can buy selectively in small lots.

P.K. Agarwal, president - research, Bonanza Portfolio said, Indian markets opened on a positive note. After trading flat with positive bias for first 2 hours, a nice rally developed.

Nifty went to a high of 4,110 and closed near the high at 4,092. Banking and Reality sectors were the best performers.

Buying was also seen in ICICI Bank, HDFC, HDFC Bank and Bharati Airtel.

However, IT sector, Satyam, Ranbaxy, Wipro and HCL Tech were under selling pressure.

Political event on July 22 will determinethe medium term trends of the markets.

If govt. passes the confidence vote, markets can extend this rally.

Nifty levels of 3985/4025 will provide support, while 4140/4220 could be the
resistance on the upside.

Investors can buy selectively in small lots``.

Alex Mathew Head, research centre , Geojit Financial Services said, ``Nifty has surged around 3.34%, the rally was partly due to short covering, and Nifty closed above its 10 day exponential moving average of 4004, if Nifty closed consecutively for 2 days above 4004, then we can expect further upside to nifty and Nifty may test 4500 levels, if there no major political crisis in coming days.

Nifty futures once breached 3965 and have prompted many investors to cover their shorts. Shorts were covered in stock futures like Reliance like Reliance, SBI, ICICI Bank, DLF and HDIL.

The IT sector stocks remained weak due to the fear of slowing down in US. Infosys, Wipro, TCS and Satyam has fallen heavily due to long unwinding.

The trend is positive and also the market breadth. If the government survives then the market may move up towards 4200 and 4600 in the short time of span.

Crude is weak below USD 135 and once USD 129 levels has been breached, once again it may fall towards USD 121 levels. Buy only at declines on Monday and avoid carry over positions for next day.``

Source: -www.myiris.com

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