Nifty: Downside support at 10,420, well above 200-Day Moving Average

The Nifty is uncertainly poised but the background signals seem to be negative. The hung Karnataka assembly results were not to the market’s taste and the BJP’s failure to put together a government triggered bearish sentiment. After that, geopolitics has taken over, with higher crude prices and a political crisis in Italy, causing a correction.

The Nifty has now etched out a sequence of falling tops though support has held well above the index's 200 Day Moving Average. The index hit a high of 10929 on May 15, before the BJP's inability to score a majority in Karnataka became obvious. That