Nifty fell sharply from intra-week resistance window of 5,750-5,780 to hit set buy zone of 5,610-5,580 for further extension into 5,559 before close of week at 5,574. Market Pulse considered 5,610-5,580 as good re-entry point after chasing 150 point rally from 5,630-5,580 into 5,780-5,830. The immediate term outlook is weak as weekly close below 5,580 will take bulls out of the street. The global bourses also do not provide support driven by uncertainties in the US and Euro zones. The domestic cues are worse, hence may need to allow deeper correction for better value buying. It is important for Nifty to get back into familiar trading range of 5,580-5,780 to knock out bearish momentum.
Commenting on the outlook for equity market, Moses Harding, Head - ALCO and Economic & Market Research, IndusInd Bank said, “The immediate support is at 5,568-5,559; test/break here will quickly extend weakness into 5,510-5,475 where it is good for strategic players to buy the second lot holding the final lot for 5,415-5,400 with stop on break here. There are strong resistances at 5,610/5,640/5,670 which should hold to retain bearish undertone into 5,400.”
“For the week, let us watch 5,510-5,610 with extension limited to 5,475-5,640. The strategy for traders is to sell at 5,610-5,640 and buy at 5,510-5,475 with tight stop on break thereof,” he said.
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