After Wednesday & Thursday of a relief rally, selling resumed on Friday as mixed cues in other Asian markets weighed on sentiment that prompted investors to trim their holdings in auto, FMCG and IT stocks. While Nifty corrected sharply, it finally took support near 16800. In an extremely volatile week, the Nifty succeeded to close above the 100 day SMA which is broadly positive. However, on the dismissal of 17150, the market could again enter in the short term bearish zone and below the same, the index could gradually fall to 16900/16750 levels. Based on the daily chart the market is forming the series of a lower top lower bottom. In case the market breaks 16800 then it would have major implications and in that case the possibility of the index hitting 16500 would turn bright. Meanwhile, on daily charts, the Bank Nifty maintained a lower top formation which is largely negative. Now, 35600 or 200 day SMA would be the key support level. And the texture of the chart suggests a strong possibility of axquick pullback rally if it succeeds to trade above 35600.
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