"Nifty is at crossroads having resistance at 2855 or so. Bullish crossover from these levels can target 2910 & 3000 whereas move below 2700 can take Nifty down to 2500 with major support at 2700. " Nifty opened with a huge downward gap as most of the Asian & European markets were trading heavily in red. Nifty after touching an intra day low of 2758 recovered slowly within the range of 20-25 points while moving in "Rising Channel" pattern & gave bullish breakout around 1430 hours & rallied to touch an intra day high of 2842 before declining marginally to close at 2795, about 49 points below the previous close.
As far as, EST charts are concerned, Nifty is locked in a trading range of 2700 & 2870 having huge opening gap on Tuesday. Any decisive breakout from the given support & resistance level will initiate one sided move of 150 points in coming sessions. However, close below 2700 may negate the short term bullish outlook in near term. Most of the index heavy weight stocks like Reliance, Rel. Capital, ICICI Bank, HDFC Bank, Tata Steel, Satyam, Infosys are giving divergent views about the market in EST charts.
Reliance Energy, Tata Power, Neyvelli, BPCL, BOB, Century, NDTV, SUN TV have given "Upward Bar Reversal" in Daily Charts while Reliance Capital, Rolta, LIC Housing, MRPL etc gave "Downward Bar Reversal" in Daily Charts.
Sector wise, power, IT, media, brokerage, oil, fertilizer stocks attracted buying at lower levels & closed in positive territory whereas stocks like Jet, Zee Ent., Tata Steel, Bharti Airtel, Hindalco, ICICI Bank, Reliance Inds., DLF looked weak during the day. As far as A/D data is concerned it was in favor of bears in the ratio of 2:1 with 767 declines & 414 advances during the day.
In nutshell, Nifty, which was slightly overbought for targets of 2785, achieved its targets & bounced back to cover part of the opening gap of Tuesday. Nifty is currently placed between 2 important levels of 2700 & 2870, breakout on either side will have important implications of 100 points in coming days. The best strategy is to book profit in stocks which are placed in support zones & any small wind can cause sharp decline in coming days. Focus can be shifted to select stocks which have given bullish breakout in last few days & target of which is not achieved ye
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