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Technical Outlook

Equity benchmarks staged a robust comeback after Tuesday’s profit booking as sharp decline in crude oil boosted market sentiment. The Nifty zoomed 179 points to settle Wednesday’s session at 15990. In the coming session, index is likely to open on a positive note amid firm global cues. We expect, index to trade with a positive bias amid commodity sell-off. Hence, after a positive opening use intraday dip towards 16010-16042 for creating long position for the target of 16127

The across sector participation supported by improvement in market breadth signifies rejuvenation of upward momentum that augurs well for extension of ongoing pullback towards 16200 in coming weeks. Key point to highlight is that, currently 37% of Nifty 500 stocks are trading above 50 days EMA compared to last week’s reading of 22%. The improvement in market breadth bodes well for durability of ongoing pullback. In the process, bouts of volatility owing to global development cannot be ruled out. Thus, buying dips would be the prudent strategy to adopt.

Nifty Daily Chart

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