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Sensex (61663) / Nifty (18308)

The Indian equity market started the day on a promising note with a decent gap up in the benchmark index, but the bulls failed to capitalize on the initial gains and the index plunged to lower levels. The hustle continued for the entire session as we witnessed an intense tug of war between bulls and bears. The trail-end sell-off led Nifty not only to pare down the initial gains but slipped into negative territory. Post such price action, the index finally concluded the session near the day’s low, a tad above the 18250 level with a mere gain of 0.13 percent.

We remain sanguine as, on a technical aspect, the index is firmly placed above all the major exponential moving averages on the daily chart and is in a cycle of higher highs – higher lows, construing a positive setup. However, ahead of the monthly expiry, Nifty has seen some tentativeness at higher levels; but we do not construe this as any sign of worry. Traders are just opting to take some money off the table ahead of the expiry event. As far as levels are concerned, 18100-18200 is likely to cushion any fall in the index, followed by the sacrosanct support of the 18000 mark. Whereas on the flip side, the 18400-18450 is likely to remain the sturdy wall for the index in a comparable period.

Nifty Bank Outlook (42437)

Bank Nifty started with a gap-up opening above the recent consolidation range. As the day progressed, we witnessed an extension of up move however during the fag end there was some profit booking to eventually end with gains of 0.64% at 42729.

Banking space continues to be an outperformer as they continue with their merry run especially the PSU counter as the PSU Bank Index ended with gains of over a percent. Bank Nifty has broken above the recent consolidation range and now previous resistance around 42600 - 42500 is likely to act as support in case of any intraday dip. On the flip side, for the expiry session, 43000 - 43230 is likely to act as resistance. The real action, however, may continue to remain outside the index and hence we reiterate keeping the focus on the stock-centric approach.

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