Volatility ruled the roost as key benchmark indices reversed direction and slipped into the red in mid-afternoon trade as European stocks dropped after the European Central Bank warned Cyprus that it will cut off emergency funding . The CNX Nifty was down 4.95 points or 0.09% to 5,689.45. The index hit a high of 5,757in intraday trade The index hit a low of 5,662 in intraday trade.
The index is signaling quite a bit of weakness going forward while given the international cues it could well be that our market might show a pullback corrective during the day since it has fallen far too sharply in the recent past. However, that rally will be more of an exit rally kind of stuff rather than any onset of a fresh intermediate uptrend shaping up....The levels to monitor on the upside would be: first the range between 5680 and 5720, next between 5730and 5740 . So long as we don’t cross the 5782-mark decisively with lot of volume activity in the cash segment and large long build up in the derivatives, we should not indulge in any wishful thinking for a sustained recovery. All rallies up to 5780 are pullback correctives and the real confirmation of 5780 getting taken out decisively will come only when the index closes above 5825.
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RESISTANCE:5700 5740, 5780
SUPPORT: 5690, 5660, 5630