10300 - 10500 becomes a crucial range: Angel Broking

Daily Market Wrap Up by Mr. Sameet Chavan (Chief Analyst-Technical and Derivatives, Angel Broking):

"Trading for the expiry day began on a cautious note owing to strong bout of selling in US markets last night. However, it just became an opening effect as we saw index vacillating in a small range thereafter with mildly positive bias. Eventually, on expected lines, the current month expiry panned out convincingly above the 10350 mark.

Market seem to have slipped into a consolidation mode and within this 10340 - 10300 band has earned great respect from the short sellers. Hence, going forward, this support zone needs to be tracked quite closely. On the higher side, the upper band is not quite far as we can see cluster of resistances between 10426 - 10500 levels. Going ahead, if market has to give any convincing relief rally, it should first surpass the 10500 mark. However, in this scenario, the broader picture does not change as we may see selling pressure at higher levels. If we have to take a directional bet, we would certainly stick with a cautious stance considering the 'Bearish Engulfing' pattern on weekly chart along with the 'RSI-Smoothened' (daily) slipping below the 30 mark. This indicates a probable correction towards 10200 first and then to test the '200-day SMA' placed around 10090.

The near term strategy would be to follow stock centric approach if index manages to give a decent relief rally and then use such rebounds to create fresh shorts at higher levels. The weakening of Indian Rupee (INR) against the US Dollar continues to be an alarming sign for our market. So, one should keep a close eye on this development as well along with US markets."

Source : Equity Bulls

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