Nifty today closed in red at 4928 after losing 37 points.Nifty gave a mild gap down opening ,later it tumbled to 4900 levels,after declaration of the March IIP data.The market breadth was negative with 498 advances to 990 declines. Matter of fact is markets reacted to the news negatively ,but with a low intensity,also the lack of participation could be a vital reason.The markets were able to sustain the 4900 levels,after which a rally was seen which took the nifty temporarily into green,the nifty could not sustain at these day high level,then corrected followed by close.
This week also we closed in red indicating looming weakness amongst sentiments of participants.In such a scenario markets are expected to trade lower and all intermediate rallies could be used to enter shorts.On the daily charts markets are likely to face resistance at 4950 and 5080 going up,likewise on the downside the 4777 level i.e. 78.6% retracement level seems approachable in days to come.
Also the technical indicators are also singing the same tune as the markets.Violation of 4777 levels will increase the fear of 100% retracement,if this occurs then we are likely to be strongly bearish and see a new low in the markets.For the upside reversal markets should provide us with enough catalyst which will help them to overcome the bears ,a strong tussle between the two will result into consolidation phase.Adding more to it we did not have a good earnings season hence i expect the markets to remain soft for next quarter or two.
Lets see what the next week comes up with.
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