Nifty faces strong selling pressure around the 4600 mark, fresh buy is sensible only if nifty maintains above 4600. Strong support for nifty is at 4360, if trades below then only we could see extreme selling pressure emerging. Below 4360, next level could be 4110.

The benchmark indices ended on huge profit?booking as selling was witnessed across the board. Metal, banking, realty and infrastructure stocks were the major draggers in today’s session. The benchmark index ended near the day’s low after touching an intraday low of 14,604, before closing the session at 14,665 down 438 points or 2.9%. The NSE Nifty shut at 4430 down 3.42% or 157 points, after seeing a low of 4404. Among the broader indices both the CNX midcap and BSE smallcap indices were under pressure, the BSE smallcap index plunged 5.8 % while the CNX midcap index fell 4.75 %. All the sectoral indices declined barring IT. The breadth remained in favour of declines and the Nifty June future ended with a 10 points discount.

The benchmark indices witnessed huge profit booking across the board after a long sustained rally. This kind of selling is natural as the indices were extremely overbought and the valuations were also stretched. Going forward we believe that markets will witness these kind of selling as the markets has to consolidate and build a base before giving a fresh breakout.

As we had mentioned in our yesterdays report that around 4650 nifty faces very strong resistance and in today’s trading the Singapore Nifty SGX made a top of 4650 in the early hour of trade and corrected from that point. We point out some of the historic data from where nifty has corrected sharply. On 24 July 07 nifty corrected from the top of 4648 upto 4002 on 17 Aug 07, on 18 June 08 nifty corrected from 4679 upto 3790 on 16 July 08, on 12 Aug 08 4649 upto 2252 on 27 Oct 08. During this entire uptrend/downtrend we have witnessed that 3800 happened to be the important support level.

For tomorrow’s intra?day trading, support for nifty is at 4360 and resistance is placed at 4530. Buying can be done if nifty maintains above 4530 from an intra?day point. Fresh weakness can be seen if nifty trades below 4360, next level could be 4220 – 4080 on the downside. Investors should wait for a healthy correction and then enter the market and for trader’s trade according to the levels mentioned.