USD-INR technicals for the week 19 December 2011 to 23 December 2011.

As long as the USD-INR remains above the 52.86 mark, it will be weak but once it breaches the 53.57 mark, new all time lows are expected as the downward journey may continue. However below the 52.31 mark it may test 50.73. Fresh longs may be initiated only when it will trade  below 48.60 conclusively, otherwise the outlook on currency is weak.

S&P CNX Nifty for the week 19th December 2011 to 23rd December 2011.

Nifty ended last week on a subdued note at 4651.6 after supply emerged in key index stocks during the latter half of Friday session. If the nifty does not trade conclusively above 4740 levels the supply may increase leading into further carnage and mayhem.  If the 4580 level gets breached on the downside then the immediate support exists at 4447 and then at 4295. Tough bargains in key index stocks is advised for mid term investors. However a technical bounce cannot be ruled out in which case if the market holds above 4740, a bout of short covering may take it to 4800 and then up to 4920.

Hard landing in China?

The credit bubble in China seems to blow up as the new home prices fell in Beijing by 35% in just a month. In August the construction firms reported $50 billion dollar worth of unsold inventories. In Shanghai too the prices have fallen by 25% this month.In the inland city of Changsa the property sales have gone down by 70%. The prices have dropped 70% in Ordos in inner Mongolia.

INR hits a new low.

A scramble for dollars saw the rupee slump to an all-time low of 53.35 to the dollar today. The interest rate was raised 13 times in the last 20 months, steepest hike in the whole world, to control inflation which has been above 9% throughout the year. Given the way policy makers are behaving and the large current account and fiscal deficits, India seems to be heading for the worst  financial crisis in decades. Sharp devaluation, as sharp as that of 1991, seems to become a reality soon.

The Eurozone crisis.

The ECB and Germany are both bent on austerity measures where as the root of the crisis lies in the balance of payments crisis in the Eurozone. No matter what formula the two may workout the financial crisis will only worsen till the ECB and Germany cast aside their proclivity towards austerity drives and recognise and address the balance of payments crisis. Hope Germany wakes up and casts aside it's moralizing dictum before it's too late.

S&P CNX Nifty for the week 12th December 2011 to 16th December 2011.

Nifty ended the week on a bearish note. However, if the nifty trades above the 4935 mark in the opening trades, a technical bounce back may see it go up to 5000 which if conclusively conquered may see another bout of short covering taking it to 5109 and beyond. However, on the downside if 4814 is breached conclusively then all short term longs may be exited. The support thereafter lies at 4756 and then at 4675.

S&P CNX Nifty for the week 5th December 2011 to 9th December 2011.

                      The market closed on a  bullish note at 5050.15 last week. If the Nifty trades consistently above the 5110 mark with good volumes, a short term uptrend can not be ruled out in the immediate term which may take it to 5170 and then to 5296 levels. Support lies at 4900. Traders are advised to trade long with strict stop loss at 4800. Profits may be booked partially above 5100 levels. It may be kept in mind that next week is a truncated week on account of holiday on 6th December2011.