Thehindu Businessline
Nifty (5,680.4)
The extremely bearish view that emerged towards the end of last week has mitigated. But it has not reversed. The rally to 5,688 implies that the risk of an immediate collapse to 4,887 and 4,515 is not present.
But investors still need to tread cautiously as the index is poised just below the critical Fibonacci resistance level at 5,720.
If the index wobbles around this level, it will mean that the outlook remains under a cloud. The routes that the Nifty can take in the week ahead and its implications are as follows,
If the index reverses from the 5,700 to 5,750 resistance, it can move down to 5,470 or 5,338.
A rebound from either of these levels will mean that the index can move higher towards 6,000 over the medium-term.
Decline below 5,338 will mean that the downtrend that commenced from the 6,093 peak has resumed that can drag the index down to 5,120 or even below.
Strong move above 5,750 is needed to make the short-term view positive again. Subsequent targets are 5,780 or 5,840.
