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Nifty

Index witnessed a brief phase of pullback within the ongoing declining channel pattern formation. The upper end of the pattern is placed around 17600-17650 which should act as a supply zone while the pattern support remains declining at 16600. Though the headroom towards 17600 remains open; there are multiple hurdles starting with 17520 (200 DEMA).Its daily oscillators are placed well for an extension of the ongoing pullback but its weekly strength indicators remain diverging. Option data for the truncated week indicates immediate resistance around 17500 while 17300 could hold its support base. While participating the ongoing pullback move it’s ideal to remain cautious while carrying forward any aggressive positions until the price remains confined within this declining trend sequence. Lack of conviction could remain evident as indicators remain diverging but equally balanced. Therefore, its ideal to remain cautious during the week & focus on sector rotational moves for short term trading. Investors on the other hand should continue to focus on relatively stronger sectors & stocks which did well during the last 4-6 weeks to retain their relative price out performance.

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