MARKET OUTLOOK 19-10-2007

It seems that the market participants have yet to absorb the ripples created by Sebi’s proposal to clamp down participatory notes. As the markets were coming to terms with the effect of the Sebi proposal motivated rumors were floated in the market on Prime minister’s resignation and increase in margins to decidedly pull it down. Earlier in the day, Nifty futures opened on a Strong note and moved up to test the all time high of 5747 and from there crashed to touch a low of 5191, an intraday fall of 556 points from the top before settling with a loss of 242.25 points. Technically, its immediate support is now around 5300 and below that 5224 is a strong support. As long as it sustains above this level on declines, the uptrend remains intact. A decisive breach of 5224 may take it down to 5060 with some support at 5100. Below 4990 the short and intermediate term trend will turn weak. Nifty futures must now sustain decisively above 5475 to signal strength, above 5620 to signal bullishness and above 5765 to signal resumption of uptrend. Its immediate resistance is at 5365.

Resistance: 5365, 5400, 5415, 5475, 5500, 5560,5620, 5700, 5725, 5765
Support: 5300, 5265, 5224, 5200, 5190, 5060

Source: Religare