Markets were in an extremely jittery mode as there was a broadbased selling across all sectors and stocks. The only saving grace was seen in stocks like Infosys, Wipro, ITC and Oriental Bank of Commerce which closed in the green. The damage in the midcap and smallcap stocks was the most painful for investors as rumours of a large number of company promoters being involved in rigging of stocks alongwith shady operators was doing the rounds of Dalal Street, We are of the view that very soon SEBI will come out and clarify the companies and promoters which are involved so that rumour mongering stops and investors have clarity about the companies which are in their portfolio.
Nifty can fall to its previous swing low of 5690 and we feel that it might find support around the range of 5650-5725 levels. We very strongly advise not to bottompick stocks and stay away from the market till some sense of stability comes back. Bottoming out is a process and not an event and hence one should have the patience for the market to complete this process. Till then, it would be wise to stay on the sidelines.
Support for Nifty lies around 5725/5690 and 5650 whereas resistance lies around 5790 and 5825-5840 levels.
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