Due to continued selling pressure in the heavy weights led by IT, banking and capital goods shares, the broad based Nifty fell further on Tuesday by 51.15 points and marked its closure at 4,449.80.

Mr. Suresh Iyer, technical analyst at Asit C Mehta said, “Nifty is at the crucial level. Last 2 days later path recovery has provided some hope. However, it is too early to assume that the correction wave was over.”

Mr. Iyer said that today’s trading pattern is important to judge short term trend.

“We have to cross couple of resistance to confirm the correction is over. Basically, the issue is, whether selling by overseas investors was exhausted first or buying by domestic mutual funds was exhausted first,” he added.

He also said that Nifty has major support at 4,370, 4,227, and 4,032-4,060 levels. Any weekly closure under 4,574 is an added signal of fresh weakness. In contrast, the resistance levels are positioned at 4,515, 4,569, and 4,651-4,669.

“Depending upon the mood of global market, the Indian market is likely to show positive momentum,” he said.

He also recommended the high risk appetite people to go long in Hindustan Unilever (HUL), Bharat Heavy Electricals (BHEL), and Satyam Computer for day trading.

Technical analyst, Vishwas Agarwal said that the BSE Sensex 14,750 around one can make some investment decisions for the medium term to earn handsome returns.    

He said, “Sensex has lost almost 30% from its recent high in just 5 months. One needs to choose emerging sectors like pharma, IT, and FMCG, where downside risk is less in current scenario.”

He advised that investors should adopt strategy to buy in dip and further fall (if any) can be used for averaging the cost.