Nifty retested the previous low zone of 4760 (as mentioned in the
previous report) and gave a sharp bounce from the support zone. It is expected
to head lower till 4500 in the medium term with some resistance points close to
4900 levels. Dollar/ INR would be interesting to watch at 55.30-55.40(futures)
as a break below the support zone would be confirm some selling pressure at
least in the short term. If it happens and give a lower close that would give
some relief for nifty at least in the short term. If we have a look into the
turnover data it tells the bounce is purely a short covering rally and the institutions
were still net sellers in the equity market. Thus the first reversal for any upside
should happen from Dollar/ INR and the beaten down large cap stocks like SBI,
ICICI and L&T. Though all the major large cap stocks are still looking weak
Axis bank is trading close to an interim
bottom and it says there is only one more wave on the downside and it can end
anywhere around 870-900. For an investor it would be a decent price for a large
cap stock like Axis. Volatility data shows some short covering happening close
to the previous support zone of 4760-70 levels and let nifty confirms a short
term bottom around this level for any fresh buying.
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