NIFTY OUTLOOK & FREE NIFTY TIPS FOR WEDNESDAY 23 FEB 2016

 "SELL NIFTY BELOW 7150 TGT 7100/6900 SL 7200"

Market performance in the run-up to the Budget this year has been one of the worst in many years. Although stock prices have rebounded following gains in the past four sessions, benchmark indices are still down over four per cent in the past fortnight. The Sensex is down 4% and 9% in the past one month and three months, respectively. Interestingly, the market performance has been lukewarm in the past three Budget days, with the benchmark Sensex changing less than half a per cent. The Sensex and Nifty ended four-day winning streak on Tuesday on the back of a broad-based selloff triggered due to weak global cues. The Sensex slumped 379 points to end at 23410 and the Nifty50 cracked 125 points to end at 7110. The Sensex and the Nifty touched an intra-day low of 23362 and 7091 each.  Sentiments also remained low since morning as investors remained jittery ahead of the Union Budget 2016-17, which is due on February 29. Sensex closed 378 points down at 23410, while Nifty settled 125 points down at 7109.

Overall sentiment continues to remain weak, which have been dragging the Nifty down; It will continue to remain under pressure in the next series as well. The February series will expire closer to 7100 levels while next series will depend on the Budget outcome.

As long as it trades above 7100, there is no immediate danger for any sharp fall. Immediate resistance is at 7150. A strong break above it can take the contract higher to 7180 and 7200.

Traders with a short-term perspective can go long at current levels. Stop-loss can be kept at 7050 for the target of 7200.

Supports for the contract are at 7,080 and 7050. The outlook will turn negative if the contract declines below 7100. The next target will be 7000.

STRATEGY: GO LONG WITH A STOP-LOSS AT 7150

SUPPORTS: 7150, 7200

RESISTANCES: 7100, 7050