For the last one week Nifty has been roughly in the range of 100 points from 5320 to 5420. Fridays move suggests that this range will be broken on the downside and the much awaited correction of last whole month will begin. Momentum indicators like MACD and RSI are also pointing to a fall and the break of the channel shown below. On the weekly charts also there is a doji formed which signals that the breaks on the upside momnetum are pressed for now. On the other hand Dow Jones at 12880 will need extra power to cross this impediment and start fresh rally. Besides that the Rupee appreciation has also halted. Tonight Greece parliament should pass the austerity bill and world markets tomorrow will not react to it very positively. My first target for Nifty is 5200-5215 only once 5325 is breached..
The best short to me appears is Larsen and Tubro which is quoting at 1350. With a SL of 1370 one can short for a target of 1300 and 1280.
On the other hand I feel IT stocks have given a clean breakout. Polaris, Wipro and HCL Tech are examples of the same. TCS is set to make new lifetime highs and one can look to add it in weakness.
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