NIFTY OUTLOOK 18 JAN 2011

The Nifty opened at the low point of the day and inched higher as the day progressed; it tested an intraday high of 4,975.55. We stated previously, move above the 4921-4918 levels would lead the Nifty to test 4,950 and 4,980. On hourly charts, RSI is approaching overbought territory, hence intraday correction cannot be ruled out from current levels. On the downside, it may correct up to 4,950 and 4,920. On the upside, if the Nifty sustains above Tuesday’s high, it may face resistance at 5,020 and 5,040 in the near-term.