“And what we have to do is then just simply watch that support level and if the support is overall holding out, the trend higher should continue to remain intact in the short term,” says Rohit Srivastava, Founder, Strike Money Analytics.
We were trading comfortably around 24,500 level. Was it a technical selloff that has led to this sharp fall in the market or is it just market as usual?
Rohit Srivastava: It is just of market behaviour. We opened up. We sold off a bit. Lot of intraday movement. But we have seen significant strength in the banking stocks. Bank Nifty doing particularly well and that continues to hold out as of this moment. So, I think it can still add up to further gains because just yesterday we broke out beyond the 24,300, 24,330 resistance zone and that zone then ends up becoming a support. And many times what happens is when you do this kind of a breakout, a lot of people ended up buying the breakout and that also can result in selling on the following day when there is no follow up, so, it may be related to that. And what we have to do is then just simply watch that support level and if the support is overall holding out, the trend higher should continue to remain intact in the short term.
The support is around 24,200 level, we are still 200 points away from on the higher side?
Rohit Srivastava: 24,300.24,300 is the support level?
Rohit Srivastava: Yes, 24,300.Do you think we could break that given the sharp fall that we have seen? We are just 80 points away from that support level now.
Rohit Srivastava: No, I would not think so. I mean you have just gotten past it yesterday, so all you can do is you can retest it as a support we do, usually do not expect it to break right away.
And if it gets broken, then how much of a downside can we see?
Rohit Srivastava: So, that is always the catch question, what if this breaks, then what happens? I try not to approach the market that way because then we might not end up giving a constructive outlook to what we are really anticipating. The real break if you have to say, oh, what if it breaks and goes down is far lower. It is the bottom that we made closer to 23,873, that is the low from where we have been recovering over the last three to four days, so that is the really more important level where overall view changes. So, if you break 24,300, will we turn bearish on the market? The answer is probably not. So, it is just a support level that ideally you expect and hope that it holds. Breaking it by 100 points makes no difference to the outlook.
We were trading comfortably around 24,500 level. Was it a technical selloff that has led to this sharp fall in the market or is it just market as usual?
Rohit Srivastava: It is just of market behaviour. We opened up. We sold off a bit. Lot of intraday movement. But we have seen significant strength in the banking stocks. Bank Nifty doing particularly well and that continues to hold out as of this moment. So, I think it can still add up to further gains because just yesterday we broke out beyond the 24,300, 24,330 resistance zone and that zone then ends up becoming a support. And many times what happens is when you do this kind of a breakout, a lot of people ended up buying the breakout and that also can result in selling on the following day when there is no follow up, so, it may be related to that. And what we have to do is then just simply watch that support level and if the support is overall holding out, the trend higher should continue to remain intact in the short term.
The support is around 24,200 level, we are still 200 points away from on the higher side?
Rohit Srivastava: 24,300.24,300 is the support level?
Rohit Srivastava: Yes, 24,300.Do you think we could break that given the sharp fall that we have seen? We are just 80 points away from that support level now.
Rohit Srivastava: No, I would not think so. I mean you have just gotten past it yesterday, so all you can do is you can retest it as a support we do, usually do not expect it to break right away.
And if it gets broken, then how much of a downside can we see?
Rohit Srivastava: So, that is always the catch question, what if this breaks, then what happens? I try not to approach the market that way because then we might not end up giving a constructive outlook to what we are really anticipating. The real break if you have to say, oh, what if it breaks and goes down is far lower. It is the bottom that we made closer to 23,873, that is the low from where we have been recovering over the last three to four days, so that is the really more important level where overall view changes. So, if you break 24,300, will we turn bearish on the market? The answer is probably not. So, it is just a support level that ideally you expect and hope that it holds. Breaking it by 100 points makes no difference to the outlook.
And when it comes to the Nifty Bank Index, what is your view on that? It has been cruising higher so far.
Rohit Srivastava: So, Bank Nifty is particularly interesting because it is going past the 61% retracement of the entire fall that we saw from the October top, so that level is at around 52,690 and staying above that or closing above that then opens up not just around 53,500, but also the possibility that you can retest the all-time high which was at 54,467. So, all of that has opened up and it means that banking will continue to contribute a lot of the gains in the next couple of days.
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