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Technical Outlook

Equity benchmarks extended their breather over a third session in a row tracking subdued global cues. The Nifty settled Tuesday's session at 17643, down 58 points or 0.3%. In the coming session, index is likely open on a negative note tracking subdued global cues. Post initial decline we expect supportive efforts to emerge from lower levels. Thus, intraday dip towards 18690-18722 should be used to create intraday long positions for target of 18807

The ongoing breather has helped index to cool off the overbought conditions (daily stochastic drifted to 46) and form a higher base that would eventually pave the way to eventually head towards 19400 in coming weeks. We believe, the move towards 19400 would be in a non linear manner as bouts of volatility amid global development cannot be ruled out. In the process, we expect broader markets to relatively outperform as it resolved out of three months higher base formation. Thus, dips should be capitalised on as incremental buying opportunity. We expect extended breather from here on to get anchored around key support of 18300 levels.

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