Charts signal further weakness ahead
Fresh round of selling possible only after dismissal of 59,700 support level, above which it could retest 60,700-60,900; on the flip side, below 59,700 quick intraday correction is not ruled out
image for illustrative purpose
Mumbai: The benchmark indices witnessed volatile trading session, BSE Sensex was down by 424 points. Among sectors, Media and IT index corrected sharply, Media index shed nearly 2 per cent and IT index trimmed over 1 per cent.
Technically, after a quick bounce back, the market opened with a positive note, but once again it took the resistance near 60,700 and corrected sharply.
A bearish candle on daily charts and Double Top formation on intraday charts are indicating continuation of weakness in the near future. However, trading set up suggesting a fresh round of selling possible only after dismissal of 59,700 support level. The current market structure is non directional.
"We are of the view that, if the index succeeds to trade above 59,700 then it could retest the level of 60,700-60,900. On the flip side, below 59,700 quick intraday correction is not ruled out," says Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities. Below which, it could slip till 59,400-59,300.
