Market OUtlook

Hi ,
The Mayhem effect of 2006 reminds me about the fact market can change its 200 or 100 or 50 DMA crossover in 3-4 trading sessions. Keeping that as a fear in mind we all know what momentum can do to market. The last leg of momemtum before election can take NIFTY to 3635-3720 level and even 3830 levels. We need two things Reliance to consolidate above 1825 levels. Else market cannot test these levels. Banking to support the upsurge.
Now take a closer look at laggards and movers.
Prefer Cement Stocks: its investor heaven but not any more till august: Rainy season impact
Automobiles: Low base effect played an important role but going forward I seriously doubt the fact that automobiles is a space to stay invested.
Reliance: GRM's will be under pressurebut momentum can do anything. Banking except the great HDFC and AXIS i doubt other banks has credentials to take an upward surge from here on. ICICI can do a little on upmove.
Others LT and Bhel: Will come in to support falling market but it would be difficult when momentum reverses.
The three crucial levels of break down are 3539-3547. than 3603 and 3672 and 3841.
As defensive move keep shorting Index at these levels with tight sl above 10 pts from the recommended levels. I dont see market to fall below 2960 but at the same time elections, govt and other clouds cannot allow momentum to get bigger and bigger and if it goes big sell sell sell. Everyone has stocks in the portfolio. Rather than exiting use nifty strategies at recommended levels to hedge position and use right breakdown signals to exit all the stock position. If marlet after touching 3547 closes below 3422, breakdown will start with a tgt of 3230 and than lets market decide further breakdown or not. Market is in a place where it can easily shed 40% of its gain i.e 400 nfty pts on a slight negative news. This is a right time to catch on unrealized profits with SL to confirm you exit with a profitable position. For eg. If JK lakshmi cement closes below 56 than the stock momentum is dead for a while but on contrary keep a hold wid a tgt of 72 test way back to 64 and than 83 in days to come. Similar for Zylog do not exit the position if you ar holding on to it. Wid a SL of 121 remain long the stock will test 157 and 183 sooner than later.
This is an Outlook on market for next week. Strenght is not visible to me but going against momentum at current levels would be suicidal. Sell at right time make small entry and exit with tight sl one can make more profit. Last resistance is wht one shld look to cover the position on shrt as it acts as a support for this time