Technical & Derivatives Report - Mr. Sameet Chavan (Chief Analyst-Technical and Derivatives, Angel Broking):
"Although the week gone by was a truncated one, it was not at all short of action. Despite some signs of relief rally from the previous week and with a smart move by Index heavyweight Reliance of 10%, the market started with deep cuts on Tuesday losing more than one and a half percent. In the rest two sessions, inspite of global turmoil, Nifty managed to avoid further slip and amidst a stock-specific bounce back it eventually ended around 11050, registering a loss of around half a percent against the previous week.
In our last week's outlook, we had mentioned a confluence zone of support formed by '89-EMA' on weekly chart, multi-month trend line support and 61.8% retracement level of the key rally (10004-12103). During the last week, the index managed to hold on to the dynamic support of above technical levels and hence the hope of relief rally remains intact. On the daily chart, we are witnessing a defined range with market participants baffled between the current scenario of global turmoil and the hopes of a government stimulus package. The said range between 11180 and 10900 will remain pivotal and the next directional move can only be seen on a range break from these levels. A break below 10900 may push prices back to retest the recent low of 10780 and further; whereas on the higher side, a relief towards 11200 - 11300 cannot be ruled out. Traders are hence advised to keep a tab on the above levels and trade accordingly. The cement, metals and auto stocks which were in a slumber phase for a while performed well and they may continue their outperformance in this week."