Finaaalllllyyyy…. Correction on the way

Finaaalllllyyyy…. Correction on the way

It’s been a long wait for the Bear’s….

Finally the markets corrected and that too heavily. Indian markets closed down 4% week on week basis. Selected frontline stocks have been bashed down badly on back of their bad earnings. LNT corrected sharply after it announced it quarterly results. But ITC & RIL counters saw sharp jump in its prices after the results.

Indian markets tanked nearly 4% week on week basis. As mentioned in my article also, that the Nifty is facing resistance at 5300. Last year in the month of May 2009, Nifty faced stiff resistance and corrected to make a low of 3800 levels. This time also Nifty faced resistance at the same levels and corrected to make a low of 4954.85. In my personal blog also (www.technicalsvishaldangaich.blogspot.com) it was said the markets are heavy and we will see correction in the near future. Nifty faced stiff resistance at 5300 levels. I had also mentioned that the Nifty will find support at 5000 and close below the same will take it to the next level of 4944-4850 levels.

Markets tanked with a record volumes. On the last day of the week the combined turnover was the highest ever at Rs.159665 Cr. On Thursday, the volumes in the F&O was above Rs.1 Lac Cr. Global markets also saw some correction. Chinese Govt have finally pulled back the trigger on lending money and to curb the inflation rate.

In the last few weeks the markets stiff resistance at the higher side. Huge selling in the markets from the FII side. Volumes in the F&O have also gone past Rs.1 Lac. It seems so, that the markets Bears are not at all in the mood to leave the Bulls this time. Last time also the Bears tried to get control of the markets, but the Bulls last movement buying, helped Nifty to close above 4850 levels in the month of Nov. In the month of Oct Nifty faced resistance at 5185 and corrected to make a low of 4538. Markets then rallied in the month of Nov & Dec to face resistance again at 5185 levels, made double top and corrected again to make a low of 4950.

On the day of the week, Nifty found support at 20DMA, but could not sustain for long. Selling continued. Nifty tanked to make a low of 4954 on the last day of the week. RSI & MACD too turned negative.

Short ICICI Bank below 834 SL 840.

Short PNB below 900 SL 915

BUY Tech mahindra above 1137 SL 1125.