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Nifty : 39395

Technical Outlook

The weekly price action formed a high wave candle which remained contained inside previous week range signalling consolidation with corrective bias .

• Index in the last two weeks is seen consolidating in the broad range of 40200 -38600 . We expect the index to extend the current consolidation in the coming truncated week and only a sustained move out of the range will signal further directional bias

• Structurally, ongoing corrective phase has already consumed 15 weeks to retrace 80 % gains of preceding 10 weeks rally of October –December (37387 -44151 ) . A slower pace of retracement signifies corrective nature of current decline

• The index has key support at 38200 -38600 levels being the confluence of (a) rising 52 -week ema and (b) 80 % retracement of June -December 2022 up move (37387 - 44151 )

• The weekly stochastic remain in downtrend and is currently placed at a reading of 30 signalling continuation of the corrective consolidation in the coming weeks

In the coming session, the index is likely to open on a flat to positive note amid mixed global cues . Index is expected to trade with corrective bias as forming lower high -low in daily chart . Hence use intraday pullback towards 39710 -39790 for creating short position for the target 39470 , maintain a stoploss of 39910

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