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Below is the Daily Market Wrap Up By Mr. Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel One Ltd

On Monday, despite SGX Nifty indicating a sluggish start, we started the session on a positive note and then continued its northward movement in the initial hour. After surpassing the 17650 mark, the index slipped into a consolidation mode. During the remaining part of the session, we witnessed a slender range with the undertone being strongly bullish. Around mid-week, markets had slightly turbulent moves, but we managed to weather them successfully. In the last couple of sessions, oversold US markets gave a sharp rebound which provided the much-needed trigger for the Nifty to come out of the recent congestion phase. With some hint of profit booking on Friday, the Nifty concluded the week convincingly above 17800 by adding 1.68% to the previous weekly close.

In the last couple of weeks, our domestic markets maintained their sturdy structure, whereas the US bourses were continuing with their declining trend. This development was restricting our key indices to surpass the higher boundary of the consolidation range despite having an inherent strength. The moment global recovery took place, we witnessed a breakout from the sturdy wall of 17700 – 17800. Importantly, the banking space was the major charioteer of this move as we saw the banking index clocking gains over 2.50% and has closed at 10-months highest level. Whenever financial counters contribute to the rally, it needs to be construed as a healthy rally. Moreover, the most laggard heavyweight basket, IT showed some encouraging signs towards the fag end of the week. This provided credence to the move and adds conviction to retest the recent psychological level of 18000 in the coming week itself. If global peers support it, we will not be surprised to see it extending towards 18200 – 18350 levels. Let’s see how things pan out going ahead.

We advise traders to continue with their recent ‘Buy on declines’ strategy and use decline towards the support zone of 17675 – 17500 to add fresh longs. Also, the broader end of the spectrum is clearly on a roll and hence, one should keep focusing on potential movers from the cash segment, which are likely to fetch higher returns. 

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