4,900 by itself is not relevant, says Parag Doctor of krsnacapital.com. “We have held 4,950 twice in the last ten days or so before we broke it couple of days back. That is a level which is to be watched and today’s high is around those levels. So for a rally to emerge, we have to at least get pass 4,950. We are at an important psychological level. The 10% correction that we have had is in line with the global markets.”
“We are still in an intermediate down trend,” says Sudeep Bandyopadhyay of Spice Group. There are a whole lot of uncertainties in the market, whether you look at Europe, or at China, or at even the India-specific liquidity issues, we are in for a period of intermediate down trend, he adds.
Where is it headed?
The basic trend, according to Baliga, is down. “Over the next couple of sessions we could actually move towards the 4,700-4,800 levels, where the technical position would be tested, so that, in case the market is still weak at that point, we could again see that 4500 levels. But I think the market is fairly valued at around 4,700-4,800. So basically looking from that point of view we have started nibbling in and in fact we will be buying more in case the market falls further.”
Doctor says, “From here some kind of counter trend rally can emerge especially with the settlement being there next week. Maybe you can go back and test the 5,000 levels one more time where the 200 day average is and then the market decides which direction it wants to go.”
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