WEEKLY LEVELS FOR NIFTY

SENSEX (21,063.6)

The Sensex moved to the intra-week high of 21,379 before declining towards the weekend. The movement last week has fuddled the short-term view. The Sensex has moved in the range between 20,550 and 21,500 since December. There are two ways in which this move can be viewed.

It could be a consolidation phase before the next upmove. This will imply that the medium-term uptrend from the low of 17,448 has one more leg to go. We need a strong close above 21,500 to prove this count right. The minimum target in this case is 23,000.

The other medium-term count is that the move from 17,448 is in its final stages and forming a terminal pattern. Continued sideways move between 20,500 and 21,500, followed by a break below 20,000 will mean that the index has topped out and is headed lower in the medium term.

It is hard to judge which of the two scenarios is unfolding since the short-term trend is sideways. We need to see the movement over the next couple of weeks to draw any conclusion. But it is obvious that the medium-term trend is up and a strong move below 20,000 is needed to negate this view.

The short-term trend is down since the index is reversing lower over the last two sessions. Immediate supports are at 20,913, 20,821 and 20,625. Reversal from any of these levels will take the index higher again.

Resistances for the short-term are at 21,379; 21,483 and then 21,973. In short, the area around 21,500 will be the key hurdle in the near-term.

NIFTY (6,261.6)

Nifty hit the high of 6,346 before reversing lower. The index is moving in the range of 6,130 and 6,415 since the first week of December. We are unable to discern the next medium-term move at this point.

A strong break above 6,420 will mean that the next leg of the move from the 5,118 low is unfolding. Minimum target in this case would be 6,590.

If the index moves sideways for a couple of weeks more and then breaks lower below 5,900, it will mean that the medium-term trend has reversed lower.

We will have to decide on the medium-term view after seeing the movement over the next couple of weeks.

The short-term trend in the index is down. Immediate support that needs to be watched is at 6,221.

The next support is at the 200-day moving average at 6,200 and the previous trough at 6,173. Short-term investors can watch out for upward reversal from either of these levels. Short-term resistances are at 6,346; 6,415 and then 6,421.