Indian Stock market update and Analyst Calls

Bombay Stock MarketsAfter a decent post election result rally, Indian stock markets are witnessing pressure as valuations seemed over-stretched. Also, many traders booked profits at higher levels as markets surprised most of them with historical rise in a single day.

The benchmark indices continued to remain under selling pressure for the third consecutive day. The Sensex ended at 13,736 down 324 points after trading between
14,089 and 13,704. The Nifty shed 59 points or 1.39% to settle at 4,211 after trading in the range of 4318?
4199. Among the broader indices ? the BSE smallcap index gained over 2.5 % while the midcap index remained unchanged. Capital goods, banking and auto stocks fell today while oil & gas counters advanced today. The market breadth was quite strong and the volumes were lower compared to previous sessions.

The benchmark indices are consolidating and are in a state of profit booking at higher levels after a steep rise. The momentum is still alive as more action is seen in the midcap & smallcap stocks. The undertone is bullish but we are cautious as we have witnessed a solid rally in the midcap stocks also. Now going forward we believe that one should be very selective in buying stocks as the broader indices have also entered the overbought territory.

Technically markets are trading far away from their short? term moving average which is a positive sign, but the 5? day moving average is placed at 4160 for the nifty and
13670 for the Sensex should act as a strong support area for the market in coming days. There is lot of multiple supports at lower level and a sharp decline should be utilized as a buying opportunity. From a trading angle if nifty breaks 4160 then we could see further weakness prevailing in the market.

For the near term support for Nifty is at placed at 4160?4110 and resistance is 4245?4295?4320. And for the Sensex support is at 13550?
13400 and resistance at 14100. A major development will be seen only if nifty moves above 4320. Until then avoid aggressive trading and maintain a low profile in the market.

NSE 5- Day Simple Moving Average 4158

NSE 21- Day Simple Moving Average 3686

NSE 5- Day EMA 4137

NSE 21- Day EMA 3747