The market was expecting lot from the budget but there has been no word on disinvestment, no mention of banking and finance sector reforms which disappointed the markets. The benchmark indices plunged sharply led by huge selling in banking, realty, capital goods, power, metal and oil & gas stocks. The Sensex tumbled 870 points or 5.83% to settle at 14,043, after seeing a day's low of 13,959 and high of 15,097. The Nifty closed at 4166 down 5.84% or 258 points, after hitting an intraday high of 4479 and low of 4133. The midcap and smallcap sectors were also badly affected. The BSE Midcap Index shed 4.98 % and BSE Smallcap Index slipped 4.2 %. Selling was across the board and the volumes were also very higher compared to previous session.

The big event is over and markets were very disappointed from the union budget which led to a massive fall of almost 6% in the benchmark indices. Now technically speaking the trend has turned very bearish as markets have just closed near to their important support level of 4110. Going forward the next crucial support is placed at 4050 and if this is broken then markets could go for a big fall. Today we have seen huge unwinding in the education, banking and reality stocks where there was huge expectation from the union budget but the streets was disappointed as there were no words spoken. Markets have just closed near to their 50?day moving averages and if this level is broken we could see further breakdown.

The RSI has also given a fresh sell signal on the daily chart. Now after a 6% fall in a single day we could witness slight pullback in coming days but these rallies will be short?lived and one should try to exit or go short. For tomorrow support for nifty is at 4110 & 4050 and a trade below this level could bring severe selling pressure into the system. On the higher side 4270 & 4330 will act as a strong resistance levels. Unless nifty manages to sustain above 4330 which is the 13?day moving average fresh buying should be avoided.

Nifty Future Daily chart: (4154) – The trend has turned bearish but the last hope is that nifty is still holding 4110 & 4050. If this point is broken then we may fall further very sharply as shown below. Be cautious and wait for the clear trend to emerge.