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Sensex (52386) / Nifty (15690)

During the last week, market started with a gap up opening on Monday. Subsequently, throughout the first half of the week, our markets traded positively to once again challenge the all-time high. However on the weekly expiry day, markets had a rough day which was mainly on the back of the negative development across the globe. Fortunately, the fall got arrested in the vicinity of the support zone to eventually conclude the week tad below 15700.

In last month or so, we have seen multiple attempts to reach the millstone of 16000; but markets are clearly struggling as something or other appears from nowhere to dampen the sentiments. The way we closed on Wednesday, we were all set to see the magical figure; but global sell off became the spoilsport on this occasion. Fortunately there was no follow through to this selling momentum as we saw Nifty stabilising after entering the key support zone of 15650 – 15600. Honestly when market fails to surpass a specific level after the multiple attempts, it is considered as an ominous sign. But fortunately there has not been any brutal correction seen so far, which bodes well for the bulls. After last two days’ of price action, our confidence of predicting Nifty towards 16000 or beyond in the ongoing leg has certainly shaken a bit; but we would still remain hopeful as long as Nifty holds a strong support zone of 15600 – 15450. If these levels are violated then one should get prepared for a decent short term correction in the market. Until then better to trade with a positive bias.

Going ahead, 15750 – 15800 are the levels to watch out for and the first of sign of strength would come only after reclaiming 15800 on a closing basis. We reiterate that, if this has to happen, the banking continues to be the key factor as it’s trading around its crucial support area. Traders are advised to remain light and stick to stock centric approach by following strict stop losses. Also, it’s important to keep a close eye on the global developments as well which is likely to set the tone for this week.

Nifty Daily Chart

Nifty Bank Outlook - (35072)

On Friday, the bank nifty started on a week note following the ruboff effect of Thursday's selloff. Subsequently after making an intraday low of 34859 in the first hour the bank index witnessed a minor bounce and post consolidating in a range eventually ended with a loss of 0.57% at 35072. During the start of the last week, we mentioned how prices are placed around a key trend line support and that resulted in a smart upmove in the initial part of the week. However, after reaching the June swing high of 35810 the prices again slipped lower on Thursday to retest the trend line support. Now if we observe this mentioned price formation we can see an Ascending Triangle formation that generally has a tendency to give a bullish breakout however there are instances where the prices have also given a bearish breakdown. Hence, we would say that Bank Nifty is on make or break level. For the coming sessions 34800 - 34500 are key support levels and if broken can trigger a further selloff whereas on the flip side if it holds then can expect a bounce-back towards 35500 - 35800 levels. Traders are advised to keep a tab on the mentioned levels and trade accordingly.

Nifty Bank Daily Chart

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