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Technical Outlook

Equity benchmarks endured their winning streak over fourth consecutive week. Nifty concluded the week at 15799, up 0.8%. In the coming session, index is likely to open on a soft note tracking mixed global cues. We expect Nifty futures to recoup initial losses and trade with a positive bias while maintaining higher high-low formation. Hence, use intraday dip towards 15720-15745 to create long for target of 15833.

Going ahead, we expect index to extend its northbound journey and gradually head towards our earmarked target of 16100 in June 2021. Our constructive view is backed by following thesis: A) The formation of higher high supported by improving market breadth highlights robust price structure. Currently 94% components of Nifty 500 index are trading above their 50 days EMA compared to May reading of 86%, indicating broader market participation B) Strong global cues have been providing impetus as majority of global indices continue to exhibit strength and hit lifetime highs. Domestic market is witnessing strong positive correlation with its global peers.

Nifty Weekly Chart

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