Is more correction on cards? Here’s how experts believe markets are likely to trade next week

• Follow

In clear signs of imminent consolidation on d-street, the domestic markets closed in the red for the fourth consecutive day in a row on Friday.

While the Nifty fell 137 points to close at 14,981 and Sensex saw a decline by 434 points to end at 50,889 on February 19.

The Nifty closed below 15,000-mark for the first time since February 5

Bank Nifty was under maximum pressure as it lost 745-points and closed at 35,841.

The Sensex breached 51,000 levels and the Nifty50 also broke the 15,000 mark after hitting fresh highs of 52516.76 and 15,431.75, respectively.

Last week, foreign institutional investors (FIIs) bought equities worth Rs 4408 crore, while domestic institutional investors (DIIs) sold equities worth Rs 6,283 crore.

Going forward, experts believe the markets may stay rangebound for some more time.

“We expect the domestic market to continue following the global markets this week due to lack of any major domestic events,” said Vinod Nair, Head of Research at Geojit Financial Services

Here’s how technical experts believe the markets are likely to trade the next week:

Manas Jaiswal, Technical Analyst

NIFTY has corrected almost 500 Points from the top, Now it is trading very near to 20DEMA, which is placed near 14,850.

Now further weakness will come only below 14,850. If it breaks 14,850 then it can test its 50DEMA, which is placed near 14,300.

On the upside, NIFTY has resistance in the range of 15,000 – 15,100, thus fresh longs should be taken only above 15,100.

So the range of 14,850 to 15,100 will be a no trade zone for Nifty.

Shrikant Chouhan, Executive VP, Equity Technical Research, Kotak Securities:

On the day of the weekly expiration of Index options, the benchmark index witnessed profit booking. Post muted opening the market registered selling pressure.

The Nifty/Sensex opened at 15,238.70/ 51,903.86 and due to constant selling pressure, erased over 100 / 400 points. Among sectors, financial services, Auto and private banks witnessed selling pressure, while Nifty PSU Banks gained the most, rallied over 5.5%.

We are of the view that the market likely to continue the narrow range activity and PSU Banks and selective midcap and small-cap stocks will outperform in the near future.

Technical, on daily charts index, maintain higher bottom series formation and the texture of the market suggests uptrend likely to continue if the Nifty/ Sensex succeed to trade above 15050/51000.

Above the same, we can expect one more leg of the up move, up to 15250, 15330/ 51900, 52300.

On the flip side, dismissal of 15,060 would result in further weakness and in that case Nifty/Sensex could retest previous lows of 14970/50840.

However, the strategy should be to buy between 15, 000/50,900 and 14,950/50,700 and for that keep a stop loss at 14,900/50,600 levels.

The focus should be on the large-cap companies as the market is approaching the major support area.