Nifty enters a corridor of uncertainty

The market ended with modest gains after a range-bound session on the back of positive global cues. The Sensex, rose 205.49 points, or 0.62 per cent, to settle at 33,455.79 points and the Nifty-50 Index rose 56.60 points, or 0.55 per  cent to settle at 10,322.25. Both the indices hovered in positive terrain throughout the trading session. The indices are at their two-and-a-half weeks high. Outlook for today Jayant Manglik, president-retail sales, Religare Securities, said, firm Asian markets triggered a gap-up start on Monday, which strengthened on the report of healthy growth in direct tax collection. CPI & IIP data will hit the Street today. “CPI is expected to inch up to 4.2 per cent, but the market is moving on expected line as the strengthening rupee is likely to ease the risk, going forward,” he said. Things to watch out The second phase polling in Gujarat will take place on Dec 14 in 93 assembly constituencies. Counting of votes will happen on Dec 18. Consumer price and industrial production figures for November will be released today. Technical view According to Sharekhan, with Monday’s move, the index has reached the 78.6 per cent  retracement (10,312–10,332) of the recent down move, which precisely coincides with ‘Upward Sloping Trend Line’. Thus, the index has now entered a corridor of uncertainty and it can give a sharp move in any direction. “If we have to anticipate any one direction, we would certainly go with a cautious stance. We expect the  index to face some selling pressure in this 30-40 points zone and hence, traders are advised to use such relief rallies to exit existing long positions. On the downside, the weakness would get reinforced once the Nifty slips below Monday’s low of 10282. In this case, 10,233–10,200 can be re-tested soon,” it said. —Ashwin Punnen

Columnist: 
Ashwin J Punnen