12 October, 2008

12,100 was to be the last hope for the bulls and, sure enough,  once below that level, the index witnessed a free fall towards  next  level of 10,300. The index touched a weekly low of 10,240.

The intensity of the fall has been extremely severe. The speed at which  the support levels are being taken off makes it extremely difficult to predict a bottom. The current low of 10,240 could count as a short-term support as long as the stock market  index sustains above the 10,200-10,300 zone. In case the index falls further, it may seek support around 8,900-9,000 levels.

For the stock market to give a meaningful pull-back, the Sensex will have to clear the resistance zone of 11,550-11,730. The NSE Nifty moved in a range of 622 points and from a high of 3,821, the index slumped to a low of 3,199, and finally settled with a huge loss of 14 per cent (538 points) at 3,280.