WKLY TECH ANALYSIS: Positive bias for Sensex seen

WEEKLY TECHNICAL ANALYSIS

Last week, the Sensex moved in an extremely narrow range of 553 points, between a high of 9,183 and a low of 8,649. The index, which witnessed undecided activity in the first two trading days, bounced back smartly on Wednesday to close with a gain of over 300 points.

While the markets remain closed on Thursday, following the terror attacks in Mumbai, the index on Friday made a steady progress to 9,093, up 178 points for the week. However, in the process, the Sensex has ended lower for the third straight month, down 695 points in November.

The broader view for December suggests that if the index is able to sustain above 9,435, it may move up to its next resistance level of around 10,200 and 10,730, respectively. On the downside, the index has a near-term support around 8,680, below which the index may slip to 8,125. While the sentiment continues to remain subdued, a 15-18 per cent rally up to 10,730 cannot be ruled out.

This week, the index is likely to find support around 8,890-8,825-8,760, while on the upside, the resistance could be around 9,295-9,360-9,425. The NSE Nifty too moved in a narrow range of 157-odd points, between a low of 2,634 and a high of 2,791. The index finally ended with a gain of 62 points at 2,755.

Technically, the index suggests that the rangebound movement will continue this week, albeit a positive bias. The Nifty is likely to move in a broad range of 3,160-2,500 till a breakout in either direction.