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Technical Outlook

Equity benchmarks endured with its losing streak tracking volatile global cues. Nifty settled the Wednesday’s session at 16972 levels down 71 points or 0.4%. In the coming session, index is likely to open on a flat note amid volatile global cues. We expect, index to prolong the corrective bias amid elevated global volatility. Currently we are witnessing unprecedented volatility, therefore intraday strategy is not provided for the session. However, key support for the Nifty day is placed at 16800 while 17100 would act as resistance for the day.

A series of lower high-low formation signifies prolonged corrective bias. However, to pause the ongoing corrective bias index need to decisively close above previous session’s high 17211. Failure to do so would lead to extended correction towards 16800. Meanwhile, on the upside 17600 would act as key hurdle as it is confluence of 200 days EMA coincided with current week’s high. The past four weeks 7% decline hauled daily and weekly stochastic oscillator in oversold territory (currently placed at 6 and 18, respectively). Therefore, traders should refrain from creating aggressive short positions as Nifty approaches keys support zone 16800-16600 amid oversold conditions.

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