The Sensex reversed its four-week losing streak on the back of weakness in metal stocks. The ongoing political drama over the Comptroller and Auditor General (CAG) report on coal allocation and derivatives expiry for the August series weighed on the investor sentiment.
The Sensex from a high of 17,820, slumped to a low of 17,338, and eventually ended with a loss of 2.3 per cent (402 points) at 17,381.
Among the Sensex stocks, Sterlite Industries was the major loser, down over 14 per cent to Rs 96 and Jindal Steel cracked 11 per cent. Hero MotorCorp, Bharat Heavy Electricals, Tata Steel, Hindalco Industries, Bajaj Auto and Larsen and Toubro were the other major losers. On the other hand, Cipla jumped over three per cent to Rs 378. Tata Consultancy Services, Housing Development Finance Corp and Tata Power ended with notable gains.
As per the monthly Fibonacci chart, the key levels for the Sensex this month would be support around 17,020-16,900-16,800 and resistance around 17,740-17,855-17,965. Similarly, next week the BSE index would look to seek support around 17,200-17,140-17,080, while face resistance around 17,565-17,620-17,680.
The NSE Nifty moved in a range of 160 points. The index touched a high of 5,399, and then dropped to a low of 5,239 before settling with a loss of 128 points at 5,258.
The index seems to have filled the gap around 5,260, which was created on August 6, 2012. The overall trend continues to remain up on the daily charts, with the index now holding around the 50-day daily moving average. The next near support for the index is around 5,220.
However, on the flip side, the momentum seems to be in favour of the bears. As the daily MACD (moving average convergence/divergence) and Stochastic Slow both are indicating further down move for the index.
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In contrast, the weekly MACD and Stochastic Slow both are positive. Hence, a mid-week recovery cannot be ruled out. Key support on the weekly charts lies around 5,160-5,120 odd levels. On the upside, the index is likely to face resistance around 5,335.
So going ahead, the Nifty could swing in a broad range of 5,160-5,335 next week.