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Nifty : 19526

Technical Outlook

• The index started the weekly expiry session on a flat note, however subsequently failed to regain upward momentum. Consequently, Nifty drifted below 19300 mark. The daily price action formed a bear candle carrying lower high-low, indicating extended correction

• Going ahead, we expect index to prolong the ongoing consolidation in the broader range of 19800-19200 which will make market healthy. In the process, stock specific action would prevail amid progression of ongoing earning season. Key point to highlight is that, secondary correction is part of a structural bull market which offers incremental buying opportunity to ride next leg of up move. Thereby, dips should be utilized to accumulate quality stocks in a staggered manner

• The broader market is taking breather in the vicinity of All time high after witnessing spectacular rally of 30% seen over past four months (in Nifty midcap index) which hauled weekly Stochastic oscillators in overbought condition (placed at 90), indicating possibility of extended breather. Thus, focus should be on accumulating quality stocks on dips in a staggered manner

• We believe, any extended correction from hereon would get anchored around key support of 19200 as it is confluence of:

• A) 61.8% retracement of current up move (18645-19991), at 19160 • B) 50 days EMA is placed at 19160 • C) July month’s low is placed at 19234.

Nifty Bank: 44995

Technical Outlook

• The price action for the day formed bear candle with lower shadow as index approached vicinity of 50 -day ema and up trendline placed around 44300 levels . It however continued to form lower high -low formation on daily time frame indicating continuation of corrective bias in the short term

• Structurally NiftyBank index is seen undergoing healthy retracement of a stellar 20 % rally from March 23 lows of 38613 and would make overall trend healthy

• In the short term we expect 45500 to act as immediate hurdle for coming week while decisive breach below 44500 may lead to panic reaction towards 43800 in the short term which will present buying opportunity

• We like PSU banking stocks to accumulate in the current decline as they are likely to relatively outperform over medium term.

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