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Technical Outlook

Equity benchmarks extended pullback over second consecutive week backed by firm global cues. Nifty ended the week at 17511, up 1.8%. In the coming session, the index is likely to open on a positive note amid firm global cues. We expect it to trade with positive bias while maintaining higher highlow. Hence after a positive opening use dips towards 17588-17612 for creating long position for target of 17698.

Going ahead, we remain constructive on the market as we expect Nifty to sustain above the upper band of consolidation placed at 17500 and gradually head towards psychological mark 18000 in coming weeks. Broader market indices are expected to extend their relative outperformance as they have resolved out of strong base formation near 50-dema with improvement in market breadth as currently 54% of midcap index components are trading above 50 days EMA compared to last week’s reading of 35, highlighting rejuvenation of upward momentum.

Nifty Weekly Chart

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