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Sensex (59610) / Nifty (17808)

The tail end profit booking in the previous session got extended at the opening itself as we witnessed a nervous start owing to sluggish global cues. Barring one attempt at the midsession, index remained under pressure and lingered around the lowest point for the major part of the day. As a result, the Nifty ended the session tad above 17800 by shedding another eight tenths of a percent.

Although key indices traded in a negative terrain throughout the day, the damage was not big. In fact post the opening, Nifty vacillated in a slender range of 100 points, which is as good as being stationary. As mentioned in the previous commentary, the Nifty is back to its key support zone i.e. 17800 – 17700 and we reiterate till the time we do not see it closing convincingly below it, there is no reason to worry for. In fact, we will not be surprised to see some recovery from current levels on the weekly expiry. On the higher side, it would be a challenging task to surpass the sturdy wall of 17950 – 18100, which should be considered as upper range for the coming session.

Yesterday one again the banking space kept sulking and due to last two days’ decline, it has almost erased 80% of its Monday’s gains. We remain hopeful for it to make a comeback and lift the benchmark index higher. Despite all this, traders are literally ignoring what’s key indices are up to. We could see individual stocks giving spectacular moves in abundance, especially stocks from the broader end of the spectrum. One should keep focusing on such potential movers, as we expect this run to continue.

Nifty Bank Outlook - (37633)

Bank Nifty started with a gap-down opening and then it remained within a slender range of 300 points throughout the session. Eventually, it ended with a cut of 1.14% at 37633.

As mentioned above, the bank index has erased around 80% of the gains seen on Monday and is now placed around the strong support of the bullish gap. Even though yesterday it was a down day, we would consider it a sluggish day as the momentum for fall was not there. In fact, we saw some of the PSU banking space was in strong buzz and showed outperformance. Going ahead, with the weekly expiry followed by the key RBI policy on Friday, some volatility may be seen however we sense the gap area around 37600 - 37200 is likely to act as support and buying to emerge from this zone. On the flip side, for the weekly expiry, we sense immediate resistance placed in zone 38000 - 38200. Traders should continue to focus on trades outside the index as stock-specific opportunities continue to outperform.

Exhibit 2: Nifty Bank Daily Chart

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