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Below is quote on Tail End correction drags Nifty towards 18200 by Mr. Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One Ltd

Markets had a quiet start with mildly positive bias despite SGX Nifty was indicating a gap down opening by nearly 50 points. After consolidating around 18300 for nearly two hours, Nifty extended its gains towards 18350. It was once again followed by some choppy trades in a small band after the mid-session. However as we stepped into a final hour of the session, the heavyweight stocks started becoming a bit nervous, which eventually resulted in a sharp decline to conclude around 18200 with nearly three tenths of a percent cut.

Overall we did not see any major action in benchmark index for the most part of the day. Only the first and the final hour had some momentum but it was on the opposite sides. Since the market saw sharper cut towards the fag end, things do not look encouraging for the expiry day. If there is any aberration on the global front, we would see Nifty correcting in the coming session as well. Here, 18100 – 18000 are to be seen as key supports. As of now, we do not see any indication of breaching this important support zone on the expiry day itself; but sooner or later, it is likely to happen. On the higher side, 18350 – 18400 remains a sturdy wall for the Nifty. Today throughout the session, the recent outperformer banking space kept sulking and in fact, the tail end correction was mainly led by the financial space itself. This certainly is not a good sign for the bulls.

Let’s see how things pan out because the volatility is expected to remain on the higher side. We advise traders to remain light and although some of the high beta mid cap counters have rebounded in last two days, one should avoid the temptation to buy with a short term perspective.

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