Charts indicate further weakness
image for illustrative purpose
Mumbai: In the last week, the benchmark indices continued profit booking at higher levels as BSE Sensex was down by 722 points. Among sectors, Media index corrected the most shed over 10 per cent whereas despite weak market conditions pharma index outperformed rallied over 1.67 per cent.
Technically, Sensex is comfortably trading below 20-day SMA (Simple Moving Average), it also holding lower top formation on daily charts, which support further weakness from the current levels.
“We are of the view that, as long as the index is trading below 71,400 points, the weak sentiment is likely to continue. Below which it could slip till 50-day SMA or 70,000 points. Further down side may also continue which could drag the market till 69,500,” says Amol Athawale, V-P, Kotak Securities.
On the flip side, above 71,400 points, the pullback move is likely to continue till 71,700-71,950 points. For Bank Nifty, it has formed bearish candle on weekly charts and currently it is trading near 200-day SMA.
For traders now, 200-day SMA or 44,700 would act as a trend decider level. Above 44,700pts, it could bounce back till 45,500-45,800 range. However, below 44,700 points, it could slip till 44,000-43,750 points.
