Market Outlook 13th October 2010

Tuesday was a big selloff day for our market.
Both Nifty and Sensex saw big sell-off due to poor IIP data and the front line index lost 0.75% in the end.
It was also attributed to the forthcoming India's largest IPO "Coal India Ltd.".
A huge chunk on liquidity was drifted out of market before the IPO opens and till it close the chances of reverse outflow are even higher.

Market is expected to remain volatile for this whole week and the choppyness may end next week.
Now Nifty has moved close to its important support level of 6084 and if this level is breached then from here we may see some strong sell-off pressure from all sides.
In the worst case scenario, Nifty may also test 1 Month's closing levels moving average 6017.
A breach of this level on closing basis will invite another wave of selling spree which may end only near psychological support level of 5900 or may be even lower.
In case if Nifty manages to regain 6131 level then we may be back in the uptrend.

Big discount in the Nifty Spot and Future levels signifies the excessive short positions created in the NIfty on the higher side.

Nifty Pivot 6117

Support 6068-6049
Resistance 6131-6163