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Technical Outlook

Equity benchmarks snapped four session losing streak on Tuesday. The Nifty settled 0.5% up at 17503 while midcap and small cap regained 1.5% each. We expect the index to continue with its previous session pullback and trade with positive bias. Hence after a positive opening use intraday dips towards 17488-17512 for creating long position for target of 17598.Key observation is, over past 20 months’ bull market, there have been three major corrections which measured average 9%. Currently,

Nifty has already corrected 7.5% from life highs of 18600. Buying in each of three corrections provided handsome returns for investors as index eventually scaled back to new highs. As we expect markets to maintain this rhythm of corrections, current correction should not be construed negative rather utilise to accumulate quality large and midcap companies as we expect Nifty to find strong buying demand in 16900-17100 zone.

Nifty Weekly Chart

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