10800 remain to be a sturdy wall: Angel Broking

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

"Last Friday, we saw index touching 10700 after traversing the stiff hurdle of 10640 with an upside gap. This development set the tone for a move towards the next important junction of 10800. Index obliged this move and started its journey towards it in the initial part of the week. However, suddenly traders looked a bit skeptical and started liquidating their longs in a rush (especially in high beta midcaps) during the second half of the week. This resulted into some nervousness in the market and hence, index corrected back to test the 10600 mark.

Finally, after five weeks' of relentless run, the winning streak came to end and it was very much on cards after hastening towards 10800. If we refer to our intra-week articles, we have been quite vocal on the possibility of some profit booking taking place after entering the 10750 - 10800. However, the velocity at which few counters took it on the chin was slightly surprising to us. Now, index is trading around its recent breakout points and hence, a possibility of some bounce back towards 10700 - 10720 cannot be ruled out. Considering the multiple Fibonacci ratios in the zone of 10700 - 10800, we are still a bit unsure whether market has enough strength to surpass 10800 convincingly in the same run. Hence, one need to keep booking timely profits and should ideally avoid taking undue risks. Meanwhile, if it keeps gyrating in the mentioned range of 10600 - 10800, the ideal strategy would be to concentrate on individual stocks.

Going ahead, 10530 - 10500 would be seen as a make or break support zone. Any sustainable move below this crucial junction would reverse the short term tide and in that case, lower levels can be expected in the near term. Hence, going ahead, traders needs to very agile now and it's advisable to keep a close eye on all these key points we have just alluded in the above section."

Source : Equity Bulls

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