Fresh round of selling possible below 58,800

Mumbai: The benchmark indices witnessed a pullback rally, the Nifty ends 86 points higher while the Sensex was up by 257 points. Among Sectors, PSU Banks outperformed, rallied nearly 2.5 per cent while sharp selloff was seen in IT stocks. As a result, IT index was corrected over 1.5 per cent.

"Technically, after a gap down opening the index took the support near 20-day SMA (Simple Moving Average) and bounce back sharply. It also formed bullish candle on daily charts which is broadly positive. However, the short term formation is still in to the negative side," says Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.

The intraday set up is between the ranges of 59,300-59,500. On the flip side, below 58,800 fresh round of selling possible. Below the same, the index could slip till 58,500-58,300, he added.