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Sensex (61003) / Nifty (17944)

During the last week, our markets started the trading activity on a mild note, however, by mid-week, the buying emergence in the broader market led Nifty to break the shackles and come out from the slumber phase. But eventually, the bulls failed to capitalize on the gains and by the weekend, Nifty re-entered its recent congestion zone. Post the intense tug of war throughout the week, Nifty settled around 17950 levels, procuring nearly half a percent from the previous week’s closure.

The lack of follow-up buying nullified the breakout attempt, and we fell back into the same zone from where we had started. However, the recent price action could be seen as constructive development for our markets as the index is hovering above the sloping trend line and has also attempted to transcend the sturdy hurdle of the 18000 mark after two weeks of consolidation. As far as levels are concerned, we remain hopeful till the sacrosanct support of 17800- 17700 is firmly withheld. On the flip side, sustenance above 18000 could only bring the cheer back in the market, while on the higher end 18200 is likely to be the sturdy wall in a comparable period.

We remain sanguine with the up trend and would advise the traders to utilize the dips to add long position in the index. Despite the lackluster moves in the indices, individual pockets kept buzzing and we expect this to continue. Hence, we advocate traders to focus on a stock-specific approach for better trading opportunities and stay with a similar buy on decline strategy till the time important supports are held comfortably.

Nifty Bank Outlook (41132)

The banking has been muted for a quite long time now. However, the intra-week bounce gave signs of breaking out from the recent congestion zone. Unfortunately, the follow-up buying was missing around the key hurdle, resulting in a false attempt. After sliding from the higher levels on Thursday, the weakness continued on the following day as prices eventually ended the week with a cut of around a percent at 41132. Bank Nifty underperformed this week and at a critical point where its support was needed to trigger a broad-based rally. It disappointed once again as it became a major culprit in dragging the market lower. Technically, prices are facing resistance around the high of the Budget session as prices corrected precisely from this key hurdle. Hence, crossing the 42000 mark remains a daunting task and before that, the bearish gap left on Friday around 41500 should also be considered as immediate resistance. For the bullish momentum to trigger, the bulls need to surpass these levels with authority. On the flip side, we sense the bank index is in a consolidation phase and remain hopeful till the key support around 40800 - 40500 is defended.

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