Nifty in downtrend, but don't see major fall now: Experts

The Indian markets were down and out in the first half of the session. But a ray of hope from Europe helped improve sentiment. Reports indicate that the European Financial Stability Facility (EFSF) will be allowed to buy bonds in the secondary markets.

The EFSF draft guidelines helped the Nifty bounce off its early lows. But the index still closed with a 50-point cut. The Sensex too recovered from the day's lows to close with a 150-point cut.

Although experts feel that the Nifty is in a downtrend, but they don't see a major correction in the near-term.

Aditya Agarwal, senior derivative analyst of Way2Wealth says, he is not seeing a major correction for the Nifty in the next three days, atleast for this expiry. ''For the last one week, the Nifty is trading in a range of 5,020 on the downside and 5,150 on the upside. We are seeing a lot of buying at lower levels. 5,020 has acted as support in the last two occasions. It can probably retest 5,150-5,180 on the higher side.''

According to Agarwal, the Nifty will expire October series somewhere in the range of 5,150-5,200. ''If Nifty corrects to 5,050 or 5,020, I think that will be a good time where one can make long positions from a three-four day trading perspective where the Nifty can retest 5,150-5,180 levels.''

On the other hand, Jai Bala of cashthechaos.com says, the market is entering a mildly bullish period. He advises traders to avoid initiating short positions now. ''Shorting on the way up is like pre-empting the market. I would rather wait for the market to drop to the region of 5,070 on the Nifty and then look at initiating short positions,'' he explains.