Market is largely negative

The benchmark indices witnessed a volatile trading session. After a roller coaster activity, Sensex was down by 1546 points. Among sectors, almost all the major sectoral indices were traded into the red but Capital Market, Defence, and PSU Banks indices lost the most, shed over 5 per cent.

Technically, after a sharp intraday dip in the second half of the day, the market trimmed some losses. From the day’s lows, the market bounced back sharply. On daily charts, it has formed a long bearish candle, and it is currently trading below the 200-day SMA (Simple Moving Average), which is largely negative.

Shrikant Chouhan, Head - Equity Research, Kotak Securities, said: “We are of the view that the short-term market texture is volatile, and volatility is likely to continue in the near future. Hence, level-based trading would be the ideal strategy for day traders.

On the higher side, 81,300 would act as a crucial resistance zone. “As long as the market is trading below this level, weak sentiment is likely to prevail.

On the downside, the correction wave is likely to continue till 80,100-79,900. Further down side may also continue which could drag the index till 79,600-79,000. On the flip side, above 81,300, the market could move up to 81,900 or 200day SMA.”