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NSE (Nifty): 17132

Technical Outlook

* On expect lines, the Nifty accelerated upward momentum and approached in the vicinity of our earmarked target of 17200. The Nifty opened Tuesday’s session on a positive note and gradually marched upward as intraday dips were bought into, highlighting elevated buying demand. The daily price action formed a significant bull candle carrying higher high-low, indicating continuance of positive bias. In the process, Nifty Midcap index regained upward momentum and clocked a lifetime high

* The formation of higher high-low backed by across sector participation signifies inherent strength which makes us reiterate our constructive stance. We believe, a decisive close above 17200 would open the door for next leg of up move towards 17600 in coming weeks. Key point to highlight is that, the Bank Nifty (which carries 37% weightage in Nifty) is placed at 3 months high. The revived traction in banking stocks along with capital goods and consumption would drive Nifty higher towards 17600 as it is price parity of Jul y- mid August rally (15515-16700), projected from past two weeks low of 16375. However, bouts of volatility after 11% rally over past five weeks in Nifty can not be ruled out. Thus, temporary breather from here on should be capitalised to accumulate quality stocks

* In line with our view, broader market indices saw rejuvenation of upward momentum that helped Nifty midcap to scale to afresh all time high. However, Nifty small cap index is still 4% away from its all-time high. We believe, the small cap index has formed a higher base above 50 days EMA and expect it witness catch up activity in coming weeks

* Structurally, the formation of higher peak and trough on the larger degree chart makes us confident to revise support base upward at 16600, as it is 61.8% retracement of current up move of 16376- 17153

In the coming session, index is likely to open on a flat note amid soft global cues. We expect the index to trade with positive bias while maintaining higher high-low. Hence use intraday dips towards 17090- 17115 to create long for target of 17198.

NSE Nifty Weekly Candlestick Chart

Nifty Bank: 36424

Technical Outlook

* The daily price action formed a high wave candle which maintained higher high -low signaling a consolidation with positive bias after Monday’s strong up move .

* Going ahead, we expect the index to maintain positive bias and gradually head towards 37700 levels in the coming weeks as it is the confluence of the measuring implication of the recent range (36300 -34800 ) and the previous all -time high of February 2021

* The index has recently generated a breakout above the past 4 month consolidation range (36300 -34800 ) . In the process the index witnessed a faster retracement of its preceding decline as 10 sessions decline (36317 -34817 ) was completely retraced in just five sessions . A faster retracement in less than half the time interval signals strength and positive structure

* The index is seen forming higher high -low in the larger degree chart, which gives up confident to revise the support base higher towards | 35000 -35300 levels as it is the confluence of the following technical observations :

* (a) 80 % retracement of the current up move (34817 -36552 ) is placed at 35160 levels

* (b) the rising 50 daysEMA is also placed at35336 levels

* (c ) the value of the rising trendline joining the lows of 28th July 2021 (34115 ) and 23rd August 2021 (34817 ) is also placed around 35100 levels

* Among the oscillators, daily stochastic remain in strong up trend thus supports the positive bias in the index

* In the coming session, index is likely to open on a flat note amid muted global cues . We expect the index to trade with positive bias while maintaining higher high -low . Hence use intraday dips towards 36310 -36370 for creating long position for target of 36630 , maintain a stoploss of 36190

Nifty Bank Index – Daily Candlestick Chart

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