Down move may continue

This week, the markets saw extreme choppiness, owing to renewed interest in buying banking shares, even as other sectors underperformed. The Sensex recovered sharply from the week's low of 18,173, rallying to a high of 18,599, only to tumble again. The BSE benchmark index finally ended the week at 18,243, a loss of 208 points.

Among Sensex stocks, Infosys slumped about 20 per cent, owing to its biggest single-day fall of 22 per cent during the week. This was because of a low growth forecast for FY14. Wipro fell 16 per cent due to price adjustment for the de-merger of its non-information technology business.

Tata Steel, Coal India, Jindal Steel and Hero MotoCorp were the prominent losers---they fell two to three per cent each. Tata Motors soared eight per cent to Rs 275. Cipla, HDFC Bank and ICICI Bank were the other major gainers.

According to the monthly Fibonacci charts, the Sensex has slipped below its monthly S2 (support 2) level. Now, the index is likely to test its monthly S3-level at 18,100, below which the next target is 17,800---the major support, according to the quarterly and yearly charts.

On the upside, the immediate resistance for the Sensex is at 18,400-odd levels, above which we could see a sharp pull-back to 18,800-odd levels. Next week, the Sensex is likely to seek support at 18,080-17,980; it may face resistance at 18,400-18,500.

The NSE Nifty moved in a range of 123 points. From a low of 5,477, the index rose to a high of 5,611, ending at 5,529, a loss of 25 points.

The Nifty has given a very weak closing on the weekly charts.---it closed outside the lower end of the Bollinger Band. The near-hurdle for the index has now fallen to 5,550-odd levels.

The NSE index is likely to test its 200-weekly moving average, which is around 5,330-odd levels. Key momentum oscillators on the daily and weekly charts continue to favour the bears.

To sum up, the Sensex has near support at about 18,100, below which it is likely to test its major quarterly and yearly support at 17,800. On the upside, the BSE index is likely to face strong resistance at about 18,400. The Nifty seems on course to 5,330-odd levels.