On weekly Chart, Market has maintained a breakout continuation formation but on intraday chart, it has formed a double top formation which indicates temporary weakness.
Nifty was the third consecutive session when the market ended flat owing to profit-booking after the recent strong rally.
Domestic markets were highly volatile tracking negative cues from global markets amid selling seen in realty and pharma stocks. However, mid and smallcap stocks continued to attract buyers leading to their outperformance. Regulatory crackdown in China, global concerns over the looming reduction in asset purchases ahead of the European Central Bank meeting and slowdown in economic recovery pulled global markets lower.
There is a slight risk-off mode in global markets in the last few days and this has impacted the bullish sentiment in India, too. Market is showing signs of correction after a steep rally. Believe there can be a correction in the largecaps that have been leading the rally this year. So, part of the fresh money is now moving into new areas like PSU banks. But they underscore this is likely to be a short-term trend.
Market remained choppy throughout the session and sentiment remained fragile amid weak global cues ahead of the European Central Bank (ECB) meet outcome, due later today. Point out that the ECB may give clear hints or even announce a timeline for stimulus tapering and cutting down bond purchase.
On the flip side, dismissal of 17200 may fuel further weakness up to 17060/16913 level. Positional traders can take a contra bet near 17000 support with a strict stop loss at 16913.
Medium term trend is still positive, Traders may prefer to book profits near resistance levels due to an overstretched rally. For the bulls, 17250/17200 would be key support level. Above it, the uptrend formation is likely to continue up to 17450/17650 level.
Sector Wise :- Nifty Media jumped almost 3 percent while metal and FMCG sectors rose about a percent each. Realty index, on the other hand, fell nearly a percent.