Bears were again predominant at the Dalal Street last week. Our markets plunged on rising inflation, weak IIP numbers and rate hike fears. It has also been dampened by weak global cues and disappointing Infosys Q3 numbers which were below estimates, dragged the Sensex and Nifty to their crucial of 19,000 and 6,000 respectively.
K Anant Rao, Kurtosis Analytics & Advisors says, "The next range would be somewhere in the range of 5,400 or 5,500 to 5,900".
Rahul Mohindar, viratechindia.com too expects levels of 5,400-5,500 being tested over the next one-two months. "In the current series, maybe 5,600 would provide some support but keeping a bigger context in mind, I could probably expect levels of 5,400-5,500 being tested over the next one-two months."
Vibhav Kapoor, IL&FS believes 5,400-5,500 is going to be the defining level between continuing bull market or a new bear market. According to him too, 5,400-5,500 should be a very good support and a good medium-term buy.
Dipan Mehta, Member of BSE & NSE said, "Basically stocks are getting cheaper and cheaper by the day because investors are not prepared to pay a higher PE multiple. So the phenomena which had taken place right through 2010 that being expansion of PE multiples that has got reversed. And we are back to some what of 2008 kind of a scenario where price earning multiples are getting compress. And rightly so because we are seeing interest rates going up and uncertainty has certainly come back to the play as far as earnings are concerned.
Alex Mathews, Research Head, Geojit BNP Paribas Financial Services: “Nifty today fell below the major support of 5,696 and closed down 1.69%. Nifty is expected to test the 200 DMA of 5,604 and if falls below this, we may see more selling coming in”.
Avinash Gupta, VP - Research Equity, Bonanza Portfolio: “Sentiment has weakened considerably as the market has broken below 5,700.The market may drift downwards”.
Canara Bank Securities (CanMoney): “Technically, Nifty exhibited a very busy and interesting show and breached the sanctity of lower support levels of 5,750/5,700 and 6,950 before closing with deep cuts. Despite a good intraday upward movement (Nifty tracked 138 points), Nifty today tanked on account of heavy profit booking. Nifty exhibited a quick downward movement and resumed its downward movement, after a massive cut of yesterday. For the sixth consecutive session, Nifty closed below its 9, 14, 50 and 100 day’s SMA level placed at 5885, 5958, 5985 and 5949 levels; these levels may act as new resistance, in coming sessions. PCR for the session was recorded at 0.95, while VIX for the day closed at higher level of 23.81% and indicating more than average volatility in market in the forthcoming sessions. RSI (14) for the day was at 32.76 levels and MACD was below the signal line, thus combined together they are giving the signals that market may remain sideways in coming session”.
ICICI Direct: "We expect the Nifty to remain volatile and traders are advised to trade with strict stop losses. Trade long from lower levels of 5550 for targets of 5750-5800 if 5550 is held. Otherwise, trade negative if 5550 is not held".
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