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Shrikant Chouhan: Short-term trend remains negative

Shrikant Chouhan/Mumbai 27 Jul 12 | 05:45 PM

Nifty opened the week on a negative note on back of negative global cues. Fresh Shorts and Long unwinding was seen in the market as Nifty started trading below the level of 5,170 and selling gained momentum on break of 5,100. Nifty tested the level of 5035; bounced back to 5,100 levels and closed the week on a negative note.

Nifty has strong support at 5,030 levels. The current trend of the market in the short-term is negative. Immediate hurdle for the market is at 5,150 levels. Sustaining above the levels of 5,150 will be positive for the markets, in that case will be exposed to higher levels of 5230 and 5,350. Up move in the market will face stiff resistance at 5,350 levels. On the lower side breach of 5,030 will be viewed negatively for lower level targets of 4960 and 4870. 5100 is 200 days average of the market on daily basis.

Steel prices have witnessed correction. Crude has seen up move and bottoming. INR has been volatile with 54-57 range. Euro-Dollar has good support at 1.18-1.20. Divergence was seen in the chart, so we can expect rally to extend 1.24-1.26 levels.

On the stock specific action, Axis bank and IndusInd Bank have been looking promising. One can look on the long side of the trade. In the oil & gas pack, Cairn India is a good bet at support levels of Rs 355.


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The author is Head of Technical Research at Kotak Securities

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