It was a volatile day on the market coinciding with the expiry of F&O contracts and key indices ended with small losses. The Sensex fell 25.36 points, or 0.07 per cent, to end at 33,819.50 and the Nifty-50 fell 14.75 points, or 0.14 per cent, to settle at 10,382.70. Volatility increased in second half of day's trading session as traders rolled over positions in the F&O segment from the near month February series to the March series.
Both BSE Mid-cap and Small-cap indices ended in the red.
Sameet Chavan, chief analyst-technical & derivatives, Angel Broking, said: “Trading for the expiry day began on a cautious note owing to the strong bout of selling in the US market last night. However, it just became an opening effect as we saw index vacillating in a small range. Eventually, on expected lines, the current month expiry panned out convincingly above the 10,350-mark.
“The market seems to have slipped into a consolidation mode and within this the 10,340-10,300 band has earned great respect from the short sellers. Hence, going forward, this support zone needs to be tracked closely. On the higher side, we can see cluster of resistances between 10,426-10,500 levels. Going ahead, if the market has to give any convincing relief rally, it should first surpass the 10,500 mark.,.. we would stick with a cautious stance considering the ‘Bearish Engulfing’ pattern on the weekly chart along with the ‘RSI-Smoothened’ (daily) slipping below the 30-mark. This indicates a probable correction towards 10,200 first and then to test the ‘200-day SMA’ placed around 10,090.”
Jayant Manglik, president, Religare Broking, said: “The derivatives expiry turned out to be a non-event as the Nifty ended flat after trading volatile in a narrow range.
“The way things have panned out, on both domestic and global fronts, in the passing weeks, we do not see any chance of overnight reversal. However, the possibility of a technical bounce can't be ruled out, citing oversold positions. Above all, the sentiment is still bearish and traders can't do without short positions.
“We advise using rebound for fresh shorts while maintaining caution in stock selection. PSU banks and pharma look weak to us while IT and FMCG is showing tremendous resilience, so plan accordingly.