Nifty could test its major support around 5,920.
Indian benchmark indices tanked today following a sharp fall in its global counterparts. While Japan's Nikkei ended down 7 percent, other Asian stocks also suffered after HSBC's latest China's flash PMI slipped below the boomand-bust level of 50 for the first time in seven months. Nifty witnessed a high volatility this week. It initially moved higher, even above the 6,220 level but could not sustain it and moved lower to test 6,000 levels after breaching
6,050 level and ended the day well below the crucial 6,000 mark. From here, it seems that the bulls may not be able to push the prices higher as the range of 6,000-6,040, is a strong resistance for Nifty from where bears can take control from them once it comes near to said level. Technically also the trend, which is now down, could test
its next major resistances around 6,000 and if Nifty crosses this level, it can go further up, to test 6,040 levels, a chance of which seems very low. On the downside, the levels of 5,920 will play major supports and any decisive fall below that could drag Nifty to its next strong support of 5,900. Nifty is currently trading below 8 and 34 Day EWMA indicating downward movement as technical momentum indicator Stochastic is currently moving in
oversold zone at 21 showing negative crossover indicating correction. RSI is currently trading in neutral territory at 60 levels on the brink of entering into neutral zone indicating further downside. MACD is also trading in negative zone showing negative divergence also suggesting downtrend.
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SHORT TERM OUTLOOK ON STOCKS:
Stocks with short term Bullish Outlook:
SUNPHARMA :S1- 985.17 S2- 964.33 R1- 1021.67 R2- 1037.33BHEL :S1- 892.27 S2- 881.38 R1- 913.92 R1- 924.68
Stocks with short term Bearish Outlook:
RELIANCE INFRA :S1- 352.63 S2- 338.67 R1- 392.93 R2- 419.27RANBAXY LABS :S1- 377.87 S2- 361.43 R1- 417.57 R2- 440.83
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