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600 points down in 4 session: Is theremore pain ahead for D-St?By Kshitij Anand, ECONOMICTIMES.COM | 14 Jun, 2016, 10.10AM IST

NEW DELHI: The tug of war between the bulls and the bears has just turned fierce ahead of key

global events such as usFederal Reserve policy review and the Brexit vote. The S&P BSE

Sensex has plunged by 612 points in a matter of four sessions after hitting Mt 27K last week.

The S&P BSE Sensex reclaimed mount 27,000 last week for the first time since October 28.

The Bollinger Bands shows the index is trading close to its 20-day moving average, which is

placed at 26,300, which is also known as the middle band. If the index closes below this level,

there is a high probability that it will drift towards its lower Bollinger Band placed at 25,072.

"The benchmark Nifty has corrected by 100 points on the first trading day of the week

and ahead of US Fed event starting Tuesday. It appears to be a shallow correction, which

should terminate somewhere between 7,950 and 8,000. The Sensex equivalent for the

same would be around 26,000," Vinit Pagaria, Senior VP - Investment Strategies

at Microsec Capital, told ETMarkets.com.

"A recovery from these levels is likely to kick off the next leg of the bull run and the

Nifty50 should move higher to the 8,650 level followed by the 9,100 level by the end of the

calendar year. In the short term, the narrow move between 8,000 and 8,300 levels appears

more likely," he said.

The Nifty50 slipped below its crucial support level at 8,100. If the index fails to reclaim this level

over the next two to three sessions, a further move towards the 7,950-8,000 levels is a

possibility.

The benchmark indices are also trading around their crucial support levels and a bounceback

cannot be ruled out. Traders should remain cautious before taking positions and trade with strict

stop losses.

"Stock markets are nervous ahead of global events like Fed meeting and Brexit vote. They are

witnessing healthy corrections, which should attract fresh buying at lower levels, preferablyaround the 8,000 mark," Mazhar Mohammad, Chief Strategist - Technical Research & Trading

Advisory, Chartviewindia.in, told ETMarkets.com.

"This correction is not going to alter the medium-term and long-term trends, which remains

intact with an upward biased. We recommend selective positional buying in scrips that have hit

new lifetime highs recently and add them to your portfolio if the Market slips further towards the

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7,950 level," he said.

If traders are interested in taking positional calls, they can do so by keeping strict stop losses on

their trades to avoid getting caught on the wrong side.

ETMarkets.com collated data of 30 stocks in the S&P BSE Sensex. The R1, R2, and R3 levelstalk about resistance levels, which the stocks will face on the upside, while S1, S2, and S3 are

key support levels if the stocks drift lower.

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