Key supports broken by the Swift fall

Mirroring the negative global cues the Indian markets
opened on a pessimistic note. Consistent selling pressure
remained at the higher end, which pushed the markets
down without a single pause during the day. Further bears
also broke the wall of 20-day simple moving average
(DSMA), which was a dominant support for the markets.
On hourly chart too, the markets did not respect the
support of 20-hourly simple moving average (HSMA) and
40-hourly exponential moving average (HEMA), which is
not at all a good sign. On the daily candlestick chart, the
Sensex has formed a Black Marubozu candle (a bearish
candle with no shadows on either side), which is also
considered a weak sign. The only favourable sign for the
bulls is the ongoing positive cycle of the momentum
indicator KST. Today the market breadth was strongly
dominated by the bears with 961 declines and 259
advances.


On hourly chart, the momentum indicator KST has given
a negative crossover, which indicates some downside is
still on cards. We are revising down our short-term bias
for the target of 2,850 with reversal at 3,165. However
our mid-term bias is still up for the target of 3,450 with
reversal placed at 2,650.


The Sensex and Nifty ended with heavy losses of 696 and
209 points respectively. All the 13 sectors of the BSE ended
in the red with the BSE Realty, BSE Metal and BSE Power
leading the fall. Among the 30 stocks of the Sensex except
ITC all other stocks ended lower with Jaiprakash Associates
(down 13%), Sterlite Industries (down 12%) and Tata Steel
(down 11%) leading the bunch of losers.