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Nifty

• The index pared initial gains after a positive opening. However, supportive efforts from the psychological mark of 18000 helped the index to recover initial losses and end the session near day’s high. The daily price action formed a bull candle carrying a higher high-low with lower shadow, highlighting elevated buying demand. In the process, daily volumes remained low with NSE cash turnover of | 43000 crore compared to 20 days average turnover of | 56000 crore

• Going ahead, we expect the index to extend ongoing pullback towards 18300. We believe recent breather helped the index to form a higher base and pave the way for the next leg of the up move. Key point to highlight is that since June 2022 lows, price wise the index has not corrected for more than 8% and time wise decline has not extended for more than three consecutive weeks. In the current scenario, we expect the index to maintain the same rhythm as it has already corrected 6% over the past three weeks that hauled the daily and weekly stochastic oscillator to the oversold territory (daily, weekly stochastic is at 18, 13, respectively), indicating possibility of extension of the pullback. Thus, bouts of volatility owing to monthly expiry should not be construed as negative. Instead, dips should be used as incremental buying opportunity. Immediate resistance for the Nifty is placed at 18300 as it is 50% retracement of past three weeks’ decline (18887-17816) coinciding with 20 days EMA placed at 18314

• Mirroring the benchmark’s move, the broader market indices have shown strength that resulted into a strong recovery post Friday’s panic sell-off and both indices engulfed Friday’s decline, indicating inherent strength. Going ahead, we expect the index to undergo healthy consolidation and form a higher base

• We believe, strong support fro the Nifty is placed at 17500 where extended correction would find its feet as it is confluence of: a) 61.8% retracement of October-December rally 16748-18887 is placed at 17565 b) 200 days EMA is placed at 17428 c) Price parity of September 2022 decline (18096 – 16747) projected from all time high of 18887 is placed at 17480

• In the coming session, index is likely open on a negative note tracking muted global cues. We expect, Nifty to consolidate with a positive bias amid stock specific action. Thus, intraday dip towards 17990-18022 should be used to create intraday long positions for target of 18108

Nifty Bank

• The daily price action formed a high wave candle with a higher high -low signalling consolidation after previous session strong up move . The index in the process is seen sustaining above the 50 days EMA (Currently placed at 42182 ) .

• Going ahead the index is expected to consolidate in the range 41600 -43000 thus forming a higher base . A follow through strength and a close above 43000 levels will signal extension of the up move in the coming sessions

• On the higher side 43000 would act as an immediate hurdle in coming sessions being the confluence of the 20 days EMA and the 50 % retracement of the current breather (44151 -41598 )

• The daily stochastic has rebounded from the oversold territory and has generated a buy signal moving above its three periods average while the weekly stochastic seen consolidating around the neutral reading of 38 signalling consolidation with positive bias likely in coming sessions

• The Bank Nifty has key support at 40700 mark being the confluence of the (a) 50 % retracement of the last 10 week’s rally (37387 -44151 ) placed at 40760 (b) the rising 20 weeks EMA is also currently placed at 40850 levels which has acted as strong support in the up move since June 2022 .

In the coming session index is likely to open on a soft note tracking subdued global cues . In today’s session retracement of last two sessions up move should be used as a buying opportunity . Hence use intraday dips towards 42430 -42510 for creating long position for a target of 42770 , with a stop loss of 42320 .

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