Nifty broke the previous low and came all the way down to the mentioned level of 5050 and it is time to look for a bounce back buying opportunity. A bounce to 5130-5140 looks quite possible and it is expected to fall to 4950 levels after the bounce.The volatility index is giving a much bearish outlook for nifty in the coming months but stocks are giving attractive buying opportunities for investors. Stocks like TATA steel and TATA motors are close to the support zone and on any bounce backs these are the stocks to watch out for quick returns. As per the chart we could see a symmetrical triangle pattern in nifty (like to look at it as a distribution zone)which would take some time to form where the lower end lies around 4950 and upper end close to 5250 levels. For the month of August this can be the range for the market if nothing big comes from Europe. Bank nifty is giving a weak signal for Nifty to break any levels on the upside. Turnover data is showing unwinding of long positions in stocks and it is better to pick value stocks based on correlation with Nifty. I don't expect nifty to fall below 5000 without giving a bounce and would like to do some bottom fishing in TATA steel (stop below 380)and stronger banking names like Indus ind bank. The fall is yet to be done and the world markets will trigger the downward move once Dow takes out 12400-12450 zone. In a nutshell the short term bounce is expected to 5130 levels and the medium term view remains bearish till 4950 zone.
