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Trading Strategy for the week ending May 14, 2000

Almost all the software stocks showed a smart rally last week with a jump in trading volumes. The average rally was nearly 25 per cent from their respective lows, and few stocks have also managed to cross their short-term resistance levels. This is a good indication and suggests at a positive outlook.

For the future, once the momentum of current rally dies down, a downward correction is likely. However, if these stocks show an uptrend and cross their highs which will be formed in the current rally, one should start taking long positions in these counters.

Stocks like Digital Equipment, Infosys, SSI, Moser Baer, HFCL, HCL Info, HCL Techno, Tata Elxsi, and Kale Consultants feature in this list.

Among the non-software stocks, traders could look at Telco, Siemens, Tata Tea, German Remedies, Hindalco and Mirc Electronics which have managed to cross their short-term resistance levels.

By Arc Investments and Consulting

Stocks

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