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Sensex (53514) / Nifty (15967)

We had a gap up opening in our markets owing to cheerful mood across the globe. However this turned out to be a formality as markets failed to sustain at higher levels. After the initial lead, our markets started sliding gradually and banking conglomerates were the major culprits in this. Due to slightly extended correction towards the fag end, the Nifty eventually closed slightly below 16000 by shedding over half a percent to the previous close

As we have been alluding to, key indices have clearly slipped into a consolidation mode and by no means, one should construe this as a sell off or a sign of concern. Yes, we are close to crucial support zone of 15950 – 15900, but till it remains unbroken, one should use this decline to go long. On the higher side, 16040 – 16140 remains a sturdy wall for the weekly expiry session. As of now, there is no clear indication of Nifty coming out of this trading range; but any decisive move beyond these mentioned levels, would trigger some momentum in index. Until then the pragmatic approach would be to buy as close as possible to support zone and try to exit around the higher boundaries.

Global markets continue to remain key factor and hence, one should keep a close eye on these developments as well. Meanwhile, traders can continue to focus on thematic moves and try to identify potential movers from the same.

Nifty Bank Outlook - (34828)

Bank Nifty started with a gap-up opening, however, it lacked followup buying and slipped lower to erase morning gains. As the day progressed the profit booking extended to eventually end the bank index with a loss of 0.87% around 34828.

After the recent rally of around 2000 points, this week we are witnessing some profit booking in this space. Since there's no major runaway selloff and since there is no major negative reversal in major indicators we continue to consider this profit booking as a retracement. One should have one step at a time and the next support to consider would be at 34500 - 34300 levels. On the flip side, immediate resistance is at 35000 - 35300. In such a scenario, where the bank index is in a secondary trend, one should focus on stock specific approach from this basket.

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