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Nifty : 17152

Technical Outlook

The index underwent a choppy consolidation after a gap up opening (17107-17177) amid stock specific action. The daily price action formed a small bear candle carrying higher high-low, indicating continuance of positive bias. In the process, daily NSE turnover (| 38,000 cr.) remained below 20 days average of | 49,000 cr.

• Over past six sessions, index has been consolidating in 17200-16800 range after anchoring recent corrective move around lower band of falling channel amid oversold conditions, highlighting supportive efforts at key support threshold of 16800 while absorbing the anxiety around the global uncertainties.

• Going ahead, sustainability above the immediate resistance of 17200 would be the key monitorable, which will open the door for a meaningful pullback towards 17600 by the end of March 2023, as it is confluence of 200 days EMA coincided with last week’s high. Thus, traders should refrain from creating aggressive short positions. Following are the key points corroborating structural positive stance:

• a) Historically, over past two decades, on all ten occasions when Nifty corrected for three consecutive months, in subsequent month index witnessed a positive return

• b) In current context, we expect index to maintain this rhythm as it has already retraced ~55% of Jun-Dec rally over past three months and gain gradually higher by end of the month

• c) Empirically, episodes of such high volatility globally and domestically has been painful to deal with in short term but always resulted in a durable bottom formation over medium term once anxiety surrounding events settles down. markets has tendency to bottom out amid bad news and Investing in such times of high volatility has always been rewarding

• d) Brent crude prices declined over 8% during last week and breached below key support of $75, for first time since December 2021. Lower crude prices are expected to support domestic currency and equities

• e) India VIX reacted from its upper band of channel indicating cool off in volatility going ahead

• In the upcoming eventful week, volatility would remain high wherein we expect extended correction to get arrested around key support zone of 16800 -16600 as it is confluence of:

• a) September 2022 low is placed at 16747

• b) 61.8% retracement of CY22 rally 15183-18887, placed at 16600

• In the coming session, index is likely to open on a negative note tracking subdued global cues. Post initial blip, we expect index to pullback while holding 17050 mark for intraday. Hence, use intraday dips towards 17080-17112 to create intraday long positions for target of 17197 with a stoploss of 17043

Nifty Bank: 39999

Technical Outlook

• The daily price action formed a high wave candle with a higher high -low as the index closed near the psychological 40000 levels . The index started the session on a positive note thereafter consolidated in a narrow 200 points range during the session and closed marginally higher by 0 . 3 %

• Going ahead, key monitorable will be sustainability above 40100 levels post the US Fed rate decision, which will open upside towards 40700 levels being the gap area of 9 th March 2023 and the 61 . 8 % retracement of the last two weeks decline (41671 -38613 ) . Failure to do so will lead to consolidation in the range of 38600 -40000 levels

• Structurally, ongoing corrective phase has already consumed 14 weeks to retrace 80 % gains of preceding 10 weeks rally of October –December (37387 -44151 ) . A slower pace of retracement signifies corrective nature of current decline within overall uptrend

• The index has key support at 38200 -38600 levels being the confluence of (a) rising 52 -week ema and (b) 80 % retracement of June -December 2022 up move (37387 - 44151 )

• The Weekly stochastic formed positive divergence indicating waning downward momentum In the coming session, index is likely to open on a soft note tracking weak US equity market . We expect index to consolidate its last four sessions pullback . Hence use intraday dips towards 39810 -39890 for creating intraday long position for target of 40130 maintain a stoploss of 39710

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