Nifty weekly update 4-8 June 2012

Nifty almost kissed the mentioned target levels of 4800 and it is expected to trade down till 4500 in the medium term with some short term bounce backs to 4950 zone. As said in the previous post we could see some of the major large cap stocks cracking below important support zones. Bank nifty is breaking down from the support zones and if there is any downward move ICICI bank and SBI could lead that. Another large cap stock that can accelerate the downside momentum would be L & T and the immediate target lies around 1050 level. In the commodities market we could see some heavy selling happening in crude oil and base metals which could be a leading signal for any crash in the equity market. Volatility index shows some short build up on ever rise in the market and global cues are contributing to the downward momentum. On the upside we could see some resistance points close to 4880-4900 as lot of buyers gave up at these levels. In the short term nifty could test the previous bottom of 4770 as the distribution pattern is very evident in the charts. Though the turnover data is low it is expected to increase if there is a further break down. Nifty could trade in a range of 4760-4880 and a move to 4770-60 should be the level to take off some money if you are on the short side.