Further Losses Likely

After an initial pull-back to 2084, the Nifty exhibited weakness. The index encountered stiff resistance around the 2077 level, which is the 50% retracement level of its decline from 2183 to 1971. In the near-term the Nifty could decline to 2000-1970. In the short-term the index has a support at 2014. If the 2014 support holds, the Nifty could see a bounce to its short-term averages around 2062-2066. A break below 2014 will see the weakness continue and the Nifty could test lower levels. IPCL could test the Rs166-163 range and on the upside the stock faces a resistance at Rs175. SBI is range-bound between Rs675 and Rs636. Shipping Corporation could test its previous bottom at Rs147. A break below Rs147 is likely to see further weakness in the stock. Reliance Industries is in the Rs575-540 range and the stock could exhibit weakness and test Rs540.

Source: Sharekhan Research