Selloff likely if Nifty breaks below 10K

The market settled with small gains after a volatile session. The Sensex rose 73.64 points, or 0.22 per cen,tto 32,996.76 points and the Nifty rose 30.10 points, or 0.30 per cent, to settle at 10,124.35. The BSE Mid-Cap Index rose 0.21 per cent and the Small-Cap Index fell 0.21 per cent.

The market breadth was negative as 1,595 shares were down while 1,094 shares were up on the BSE.

Technical view

Vikas Jain, senior research analyst, Reliance Securities, said: “The Nifty consolidated and ended flat, up by 30 points, after hitting lows at 10,050 levels. The Nifty has strong support in the region of 10,000 to 10,030 levels, 13 month average and four-month lows.

“The Nifty has closed below the 200-day average for two days in a row and in case it breaks down below 10,000 levels then it would trigger further selloff in the market across sectors and stocks. On the higher side multiple resistances are placed at 10,300-10,330 level,s which is the short-term average.

“The FOMC meeting and commentary will be important to watch from current levels and decide the next leg of broader market direction across global markets.

Market view

Mustafa Nadeem, CEO, Epic Research, said:  “We are seeing some buying in mid-cap and small-cap, which is of course, due to them being corrected to a lucrative level. This may be seen going forward while action will be stock specific. Sector-wise we continue to remain bullish on IT as being preferred amongst all while FMCG may draw more buying in the coming week as it looks to come out of consolidation.

--Ashwin Punnen