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Level-based trading ideal amid volatility

The benchmark indices witnessed profit booking on Thursday and the BSE Sensex was down by 433 points. The BSE Sensex opened with a gap down and comfortably broke the intraday support of 60,100. Post breakdown, entire day it was trading below 60,100 level, which is broadly negative.

Sensex forms long bullish candle
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Sensex forms long bullish candle

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Stock Picks

- TATAELXSI: Above Rs6,638 with a target of Rs6,704 and Stop loss of Rs6,572. The stock is in upward trending channel and has given the breakout

- COFORGE: Above Rs5,377 with a target of Rs5,430 and Stop loss of Rs5,324. It has support of 8 and 40 EMA

- KPRMILL: Above Rs540 with a target of Rs545 and Stop loss of Rs535. The stock is in upward trending channel and is on the verge of a breakout

- INFY: Above Rs1,733 with a target of Rs1,750 and Stop loss of Rs1,716. It has a support of 8 EMA

- BLUEDART: Above Rs6,990 with a target of Rs7,059 and Stop loss of Rs6,921. It has reversed from the support of 8 EMA

(Source-CapitalVia)

Mumbai : The benchmark indices witnessed profit booking on Thursday and the BSE Sensex was down by 433 points. The BSE Sensex opened with a gap down and comfortably broke the intraday support of 60,100. Post breakdown, entire day it was trading below 60,100 level, which is broadly negative.

Among sectors, most of the major sectoral indices witnessed profit booking. And the technical selloff was seen in reality sector, down over two per cent. Technically, the index has formed bearish candle and after an intraday sharp correction currently trading near 50-day SMA.

The intraday texture of the market is weak, but strong possibility of one pullback rally is not ruled out if it succeeds to trade above 50-day SMA or 59,700.

"For the day traders, 59,700-59,800 would be the key support levels and as long as the index trading above the same bullish sentiment will intact," says Shrikant Chauhan, head of equity research (Retail), Kotak Securities.

On the flip side, below 59,700 it could trigger short term weakness as a result we may see a quick intraday correction up to 59,400. The texture of the market is volatile. Hence, the level-based trading would be the ideal strategy for the day traders. Trading above the same, the index will move up to 60,650-60,900, he added.

Another analyst said that we witnessed some corrections in the market after it failed to sustain the level of 59,700 in the market. Our research suggests that 59,500-59,700 will act as a support zone in the market. If the market is able to sustain these levels, we can witness a bounce back and Shift in momentum. Technical indicators suggest a volatile movement in the market, he added.

Kumud Das
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