The markets began FY08 on an inauspicious note following the Reserve Bank of India (RBI) decision to hike the cash reserve ratio (CRR) and the repo rate. In its bid to contain inflation, the RBI hiked CRR by 0.5% in two tranches and the repo rate by 0.25%. The benchmark BSE index, Sensex, recorded its second-biggest fall in absolute terms on Monday tumbling 617 points. A recovery in banking, metal and technology shares saw the index cut losses and finally end the week at 12,856 - down 216 points.The Nifty plunged to a low of 3617 before bouncing back to close at 3752 - a loss of 70 points for the week as against a 188-point fall on Monday.The Sensex low of 12,426 last week is close to the S3 (support 3) level for April at 12,410. As long as the index stays above this level, it may rally to 13,800 on the upside in the coming days. This week, the index may find significant support around 12,675 level, while on the upside the index may face resistance around 13,040-13,150 range. The Nifty may face resistance around 3830-3855-3875 on the upside, while the support on the downside would be around 3675-3650-3625. A strong upmove could see the index rally to 3960.
