Correction wave may continue as Sensex forms bearish candle
Below 52,900, it could retest the level of 52,500; Further down side may drag the index up to 52,200
image for illustrative purpose
Mumbai: On the day of weekly expiry day, the benchmark indices corrected sharply. BSE Sensex was down by 1,362 points. Due to weak global markets conditions, our market opened with a gap-down and maintain negative stance throughout the day. Among sectors, all the major sectoral indices were traded in the red, but IT index lost the most, drag over five per cent.
Technically, the market opened below the important support level of 53,100 and post breakdown, it intensified weak momentum which is grossly negative. In addition, post gap down the index has formed bearish candle that also support further weakness from the current levels.
"We are of the view that, the intraday texture of the market is weak. But currently the index is trading near 52,500-52,600 support level. Hence, strong quick pullback rally is not ruled out, if the index succeeds to trade above 52,500", says Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.
For the traders, as long as the index is trading below 52,900, the correction wave is likely to continue. Below which it could retest the level of 52,500. Further down side may also continue which could drag the index up to 52,200. On the flip side, above 52,900 the Sensex could move up to 53,100-53,500.
