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Technical Outlook

Equity benchmarks extended their rising spree on fourth session on the trot tracking firm global cues. The Nifty ended Wednesday’s session at 16521, up 180 points or 1.1%. In the coming session, index is likely to open on a flat note tracking muted global cues.

We expect the index to consolidate in a range after recent strong up move amid weekly expiry. Hence, use intraday dip towards 16450-16482 for creating long position for the target of 16567. The past four sessions 720 points rally has hauled index to upper band of rising channel (as shown in adjoining chart) amid overbought condition of daily stochastic oscillator (currently placed at 94).

Thus, we believe, a decisive close above 16600 would open the door for extension of ongoing up move else couple of day’s breather cannot be ruled out wherein broader market would witness catch up activity. However, such breather should not be construed as negative instead dips should be capitalised as incremental buying opportunity. The formation of higher high-low supported by across sector participation makes us confident to revise support base upward at 16100.

Nifty Daily Chart

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