5 October 2016


On Wednesday market breadth was tilted in the favor of the bears.  India market erased its gains initial gains and was trading marginally lower due to weak Asian cues. The Nifty reclaimed its crucial level of 8800 supported by gains in realty, power, metal, consumer durable, capital goods, auto, and banks. The Sensex ended with a loss of 114 points at 28221. It opened at 28426, touched an intra-day high of 28478 and low of 28189. The Nifty closed with a loss of 25 points at 8743. It opened at 8806, hit an intra-day high of 8807 and low of 8731.
I don't think there is any weakness in the market; it's a pure technical correction and normal profit-booking, the next big trigger would probably be the corporate earnings. From medium term perspective the key support is at 8830-8850 level. We expect this level as important one and likely to absorb any further selling pressure. And most likely market to hold above this level. On the upside supply is coming at 8850, breaking of the level market will find the momentum which is lacking couple of days and will then set for moving above the recent swing high at 8870 level. Investor is advised to initiate long on a break above 8850 with a stop below 8700.
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Supports: 8710 and 8650
Resistances: 8830 and 8870