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Nifty : 19660

Technical Outlook

• The Nifty started the session on a positive note tracking firm global cues post US Fed meet outcome. However, failed to sustain at higher levels as a result index snapped two days winning streak. Consequently, daily price action formed a bear candle carrying lower low, indicating extended consolidation. In the process, broader market relatively outperformed

• We expect, index to prolong the ongoing consolidation in the broader range of 20000-19500 which would make market healthy by cooling off the overbought condition and eventually pave the way for next leg of up move. Thus, extended breather should not be construed as negative, instead dips should be utilized as an incremental buying opportunity since strong support for the Nifty is placed at 19500.

• The broader market has been relatively outperforming despite ongoing consolidation in the benchmark. However, key point to highlight is that, past 4 months 28% rally hauled weekly oscillators in overbought conditions, indicating possibility of temporary can not be ruled out. Thus, any temporary breather should be capitalized to accumulate quality stocks amid ongoing earning season

• Structurally, Nifty has not corrected for more than ~2% while sustaining above 20 days EMA. Thus, we retain our support base upward at 19500, being confluence of:

• A) 38.2% retracement of current up move (18645-19991), at 19478

• B) 20 days EMA is placed at 19516

• C) Since March index has not closed below previous weeks low. Last week’s low is placed at 19562

Nifty Bank: 45680

Technical Outlook

• The Daily price action formed bearish engulfing candle as index failed to sustain opening gains and faced profit booking around previous week’s high of 46370 indicating slow down in upward momentum . PSU banking stocks performed relatively better

• Nifty Bank index is trading in a narrow range of 45500 - 46300 over past four sessions indicating consolidation after sharp run up led prices to overbought trajectory

• We expect index to hold immediate support of 45200 and gradually head higher after brief consolidation while PSU banks are expected to outperform relatively

• Key short term support is now being revised upwards to 45200 being last Tuesday’s low that coincides with rising 20 -day ema which has been held on multiple occasions since March 2023

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