Bulls and bears continued to battle it out in the domestic market as weak global cues persisted, keeping the market under pressure. The US economy contracted amid muted demand conditions with the service sector witnessing a sharp decline. Markets in Europe experienced a protracted sell-off as a result of investor's concern over the oil crisis and the uncertain growth outlook. Domestic stock markets witnessed a volatile trading session on Wednesday with headline indices dancing between gains and losses. At the end of the day, Sensex added 54 points to settle at 59085 while the Nifty jumped 27 points to close at 17604. Bank Nifty zoomed 0.88% to close above 39000 while India VIX dropped 3% to settle at 18.43. The index remained choppy during the day as the Nifty moved within bands of 17500 and 17600. The daily RSI is in bearish crossover. However, it has sustained above the important near term moving average during the day. After the first leg of the decline from 18000, the Nifty had taken support near the 20 DMA on August 23. Thereon the index is attempting a minor degree bounce. The price action in the last couple of sessions shows an overlapping structure. Also, the index has now reached near the junction of the 40 hour exponential moving average & the hourly upper Bollinger Band. This setup suggests that the next leg down is around the corner. On the downside, 17400-17350 will be the initial target area, below which 17200 will be the overall short term target. On the other hand, 17675-17750 is the key barrier that is expected to keep the bounce in check. The trend for the short term looks sideward. On the higher end, resistance is visible at 17750; whereas on the lower end, support is visible at 17550/17450.
Resistance: 17700, 17750, 17800
Support: 17600,
17500, 17400
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