The week ending 28 January2011 saw very volatile trade on the Indian bourses with heavy bear hammering. After touching an intra week high of 5802, Nifty slid down to 5459 before finally settling at 5512, in the very last moments of trade on Friday. The Nifty has closed below its 200 DMA for the second consecutive day.
The rally in Nifty which started from September2010, when Nifty was trading around 5350 levels, saw demand of heavyweight index stocks rising continuously from the foreign institutional investors who bought Rs. 250000 crores worth of stocks. But the January meltdown saw a supply of around Rs 7000 crore worth of stock and with Nifty giving up all the gains of the four months.
The MACD is suggesting a fresh downside in the days to come. However a technical pull back cannot be ruled out in the immediate short term but a rise will mostly be used to create fresh shorts.
From a medium term perspective any significant downside can be used to buy metal stocks, especially the iron ore ones.
The support for Nifty is seen at 5250 levels, but a further erosion cannot be ruled out.
The rally in Nifty which started from September2010, when Nifty was trading around 5350 levels, saw demand of heavyweight index stocks rising continuously from the foreign institutional investors who bought Rs. 250000 crores worth of stocks. But the January meltdown saw a supply of around Rs 7000 crore worth of stock and with Nifty giving up all the gains of the four months.
The MACD is suggesting a fresh downside in the days to come. However a technical pull back cannot be ruled out in the immediate short term but a rise will mostly be used to create fresh shorts.
From a medium term perspective any significant downside can be used to buy metal stocks, especially the iron ore ones.
The support for Nifty is seen at 5250 levels, but a further erosion cannot be ruled out.
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