Support at lower level :

In spite of panic in US markets last night, Indian market did not witness any major sell-off. On the contrary, Indianmarket made a smart recovery in the second half of the session with Sensex closing 29 points lower, while Nifty ending 9 points down. However, stocks from mid-cap and small-cap indices ended the day in positive. On dailycandlestick chart, Sensex has formed a closing Marubozu candle, which is considered a strong candle, and bulls are safe until today’s low gets breached. Further, on the daily chart, the market jumped back into the corner of the bulls just after kissing the neckline of inverted head & shoulders pattern. The market also respected the support of 40-days exponential moving average. On the hourly chart,Nifty did not break the wall of hourly averages and started upward journey just after taking the support at 20-hourly simple moving average. The up-trend of daily KST is still intact. The market breadth that was negative in the morning turned in the favour of bulls as the sessionended.

On the hourly chart, the gap between the momentum indicator KST and signal line is getting slimmer. Our shortterm bias is up for the target of 3000 with reversal at 2752. However, our mid-term bias is still down for the target of 2450 with reversal pegged at 3111.

Stocks from metal, healthcare and energy space led the pack of losers today, while stocks from auto and power sectors led the pack of gainers. From the 30 stocks of Sensex Maruti Suzuki India (up 4%), ACC (up 3%) and Jaiprakash Associates (up 2%)led the pack of gainers. On the other hand Ranbaxy Laboratories (down 5%) and Grasim Industries (down 4%) topped the list of losing scrips.

(Disclaimer: The above chart shown is for study purpose only and not for trading decision)

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