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Technical Outlook

Equity benchmarks extended losses tracking escalation of geopolitical issues, that lead to spike in Crude Oil prices towards $138, for the first time since 2008. The Nifty ended Monday’s session at 15863, down 382 points or 2.35%. In the coming session, index is likely to open on a soft note tracking subdued global cues. As the index has approached oversold territory. We expect supportive efforts to emerge from lower levels. Thus any pullback towards 15692- 15725 should be used to create long position for target of 15810. The formation of lower high-low signifies continuance of corrective bias. Key point to highlight is that, over past ten sessions index has dipped 10% that hauled weekly stochastic oscillator in oversold territory currently placed at 14. Thus, traders should avoid creating aggressive short position at current juncture. However, for a meaningful pullback to materialise index need to form a higher highlow on a closing basis. On the contrary, a decisive breach below immediate support of 15800 would lead to prolongation of correction towards 15400 in coming weeks

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