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Technical Outlook

Equity benchmarks witnessed sharp selloff in fag end of session to settle below psychological mark of 17000, lowest level in one month. The Nifty settled at 16958, down 215 points or 1.25%. In the coming session, index is likely to open on a flat to positive note tracking positive global cues. The index is likely to face selling pressure in pullback after Tuesday sharp selloff, hence use up move towards 17070-17105 for creating short position for the target of 16983 In entire corrective phase from 18114, over past nine sessions index has failed to sustain above previous session high on closing basis. Although a technical pull back from 200-day EMA (16839) due to oversold nature of prices (daily stochastics at 13) cannot be ruled out, only a sustained higher high-low formation would signal pause in downward momentum as immediate upside is capped at 17300 as it is a) current week’s high and Monday’s falling gap area and b) 38.2% retracement of past nine session decline (18114-16824)

Nifty Daily Chart

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