Monday, April 19, 2010

More downside seen before another bounce...


After bears took control and closed Nifty below its 20 DMA on thursday, friday again saw heightened intraday volatility with sudden up and down spikes.

The options data is pointing to more bearishness as there was heavy unwinding of more than 10 Lakhs seen in 5300 put.

The PCR ratio based on the open interest is still bullish with 1.36 and looking at the overall data, there could be more downside seen immediately before markets can give another bounce.

In the weekly charts, a bearish reversal pattern has been formed and any move and close above 5354 this week would nullify the bearishness. The key support are 5198, 5134 and 5092, with resistance at 5354, 5406 and 5446

The key levels for today are

Resistance levels : 5274, 5286, 5306

Support levels : 5225, 5206, 5187

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Happy Trading
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