Profit booking possible at higher levels

Mumbai: On Monday, the benchmark indices witnessed a sharp sell-off in the first half of the trading session on the back of steep weakness in the technology stocks, however, due to broad-based buying in the BFSI sector, we saw the Nifty closing 125 points lower which was 350 points down at one point of time, while the Sensex ended 520 points lower. Among sectors, the Realty and BFSI index fared better while technology and pharmaceutical stocks saw intraday profit booking. Technically, after last week's stellar rallies, the market saw some profit booking at higher levels. On the daily charts, the index has formed a bar-reversal candlestick formation indicating time-based correction till the market is not crossing 60,400 levels.

“We are of the view that the medium-term market structure is bullish, but we may see some profit booking at higher levels due to a deep decline in today’s date,” says Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities.

For the bulls, 60,200-60,400 would act as immediate resistance zones, while 59,500-59,200 will act as key support zones. Buying on intraday corrections is advisable as reducing weak long positions between around 60,200 levels. Fresh buying momentum is only above the levels of 60,400.