A K Prabhakar, Independent Market Expert, is of the view that Nifty has taken support at 200-DMA which is placed around 5,970 levels on closing basis. Now, the index can bounce towards 6,200-6,415 levels. The highest call writing was seen at 6,200 levels.
According to analysts, some technical indicators and positioning in derivatives point to a potential rebound in Nifty index.
"The biggest number of open interest February contracts placed at 6,000 puts, suggesting investors expect that to be a strong support level," added the report. Technically, the NSE is trading just above the daily relative strength index ( RSI) of 30, which has been a strong support level since August.
The NSE is also seeing strong support at 5,955.82, the 38.2 per cent Fibonacci retracement on the rise from the August 28 close of 5,285 to the December 9 close of 6,363.90, added the Reuters report.
On Tuesday, Nifty managed to bounce back; but finally ended flat at its crucial support level of 6000. Today (Wednesday), is the second day when Nifty managed to bounce back from 5970 levels which is also its 200-DMA and an important support level.
In the very short term, as long as Nifty trades below the level of 6,040 the bearish trend would remain intact, argue analysts.
"We have engineered some sort of a bounce back on Tuesday and chances are this has happened because the 20-day moving average is still at 6,200; and if prices tend to move too far away from that average, there may be a pullback," said Ashwani Gujral, Fund Manager, Ashwanigujral.com.
"We will have to see how much strength we are able to gain above 6,100 levels if we go there. In case it is a weak kind of a pullback of say 15-20 points, then it's a pretty low momentum pullback. In this case, it should be clear that we should be turning around fairly soon," he added.
Copyright © 2014 Times Internet Limited. All rights reserved.
via Business - Google News http://ift.tt/1b15wLG
Put the internet to work for you.
0 comments:
Post a Comment