Expect further weakness below 12300

We have been indicating a retracement down to 12460-11761-11062 in the last couple of weeks. The low registered last week was 12344 and the week closed at 12844.99. Although, the Sensex had violated 12460 during the week, it staged intra-day recovery from these levels as well. The bounce to 13145 was also witnessed after attaining 12460. The level has its own importance and followers of technicals know the importance of retracement levels and the respect it commands. This does not mean that they cannot be violated or that they end in themselves.

Last week, the Sensex opened at 12716.85, fell to a low of 12344 and moved up to attain a high at 13145.72. Finally, it closed the week at 12884.99 against the previous week’s close of 12886.13. That means the weekly closing was flat on a week-to-week basis.

More about below 12300
Support for Sensex at 12330