Nervousness in late morning trades, saw the markets test its crucial support at the long-term (200-days) moving averages. Fresh buying at lower levels, coupled with positive cues from the European markets led to a sharp pull back in the indices. The benchmark indices eventually ended on a flat note on lack of buying support at higher levels.
The Sensex tumbled to a low of 15,652, but recovered smartly and rallied to a high of 16,061. However, the index eventually ended with a gain of 20 points at 15,936.
The 200-days DMA (Daily Moving Average) of the Sensex is at 15,573. As long as this holds, the index is likely to move up to its short-term (20-days) DMA which is at 16,760. However, given the overall weakness any pull back from current levels is likely to be short-lived, and chances are high that we break the long-term moving averages going forward.
The Nifty swung in a range of 124 points, from a low of 4,675 the index surged to a high of 4,799, and finally ended three points higher at 4,760.
The long-term DMA for the Nifty is at 4,665, and the short-term DMA is at 5,008. Today, the index may seek support around 4,715-4,700-4,685, while face resistance around 4,805-4,822-4,837.
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