Indices to move in a range

Weekly Technical Analysis

After five weeks of losses, the major indices, the Sensex and the Nifty, posted gains last week on the back of renewed buying interest in the markets.

The markets began on a positive note, with the Sensex gaining as much as 215 points on the first trading day of the week. The index went on to log gains of the four trading days and touched a high of 13,387 "" 960 points "" from a low of 12,427 earlier in the week. The index finally settled with a significant gain of nearly 7 per cent (856 points) at 13,286.

In the previous week, we had mentioned that the bulls have a glimmer of hope, and if the index is able to cross 12,940, it may rally to 13,800. The index seems to be on course to 13,800 after having crossed 12,940, which now becomes the support level for the index this week.

Similarly, the Nifty rallied to a high of 3,902 from a low of 3,603 "" an intra-week up move of 299 points. The index ended with a gain of 252 points at 3,861.

The Nifty is likely to target 3,975 this week, above which the index could rally to 4,010 and 4,045.

On the downside, the index is likely to find support around 3,745, below which the index could drift to 3,710 and 3,675. The Sensex is likely to face resistance around 13,650-13,765-13,880, while the index may find support around 12,920-12,805-12,690.

The outlook for this week is that the Sensex may move in a range of 13,800-12,940.