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Sensex (58254) / Nifty (17354)

The lackluster session on the monthly expiry day was followed by a strong opening on Friday. We witnessed good broad based buying throughout the session to conclude the year on a happy note well above 17300.

Despite some correction in the recent past, Nifty managed to clock whopping gains over 24% year on year, which is certainly an achievement for Indian markets. Also the way it closed above 17300, the new year is likely to kick-off on a positive note. As a conservative trader, one can wait for a sustainable close beyond 17400 which is the higher end of the ‘Downward Sloping Channel’ on the daily time frame chart. But the way individual stocks are behaving, it is likely to happen in the coming session only. After this, the immediate levels to watch out would be around 17550 – 17700. On the flipside, the base is shifting higher towards 17000 – 16800 before which 17150 is to be considered as a key support.

Traders are advised to trade with a positive bias as long as we remain above the mentioned base. The midcap index is well poised and hence, individual stocks are probably gearing up for a prebudget rally. Let’s see how things pan out going ahead and the next week would confirm the short term path for our markets.

Nifty Daily Chart

Nifty Bank Outlook - (35482)

On Friday, Bank Nifty started on a positive note and the positive momentum continued throughout the session to eventually end with gains of 1.19% at 35482.

Bank Nifty has now broken out of the recent congestion zone on the upside however it has now approached key resistance of long-term moving average of 200SMA. Further positive traction in the bank index breaking above the key average may turn catalyst for the next leg of upmove in the broader market. Hence, 35700 - 36000 would be closely watched. Since the RSI indicator has given a fresh buy signal with its smoothened moving average we sense these levels are likely to be breached soon. Traders are henced advised to continue with the positive bias. On the flip side, immediate support is seen around 35100 - 35000.

Nifty Bank Daily Chart

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