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Nifty: 16606

Technical Outlook

• The Nifty witnessed a gap down opening (16794-16593) and inched downward. However, supportive efforts from the 80% retracement of Monday’s trading range helped the index to recover some of intraday losses in the second half of the session. As a result, daily price action formed an inside bar, highlighting dwindling downward momentum as the index managed to hold Monday’s low despite escalated geopolitical volatility

• Going ahead, sustainability above Monday’s panic low (16350) amid ongoing global volatility would keep pullback option open. Key point to highlight is that, time wise the index has maintained the rhythm of not correcting for more than three consecutive weeks, since April 2020. In the current scenario, as the index has already corrected over past three weeks, we believe the Nifty is poised for a technical pullback from the oversold territory.

• Meanwhile, as per change of polarity concept earlier support of 16800 would now act as an immediate resistance for the Nifty. Thus, a decisive close above 16800 along with cool off in VIX and crude oil prices will add fuel to the ongoing pullback rally towards 17200 as it is the 61.8% retracement of February decline (17795-16203), placed at 17186

• Structurally, in a secular bull market 52 weeks EMA offers strong support. In current scenario index has approached in the vicinity of 52 weeks EMA along with oversold conditions that augurs well for impending pullback. Thus, on the downwside16200 will be the key level to watch, as it is a confluence of:

• a) price parity of October – December decline (18604 -16410), projected from January high of 18350, at 16200

• b) current week’s panic low is placed at 16203

• The broader market indices relatively outperformed the benchmark in Wednesday’s session. Currently, the Nifty midcap and small cap indices are hovering in the vicinity of key long term average of 52 weeks EMA. Thus, we expect broader market to undergo base formation amid ongoing global volatility In the coming session, index is likely to open on a flat note tracking firm Asian cues. We expect volatility to remain high owing to weekly derivative expiry along with ongoing geopolitical issues. The formation of higher lows signifies elevated support base. Thus any dip towards 16504- 16534 should be used to create long position for target of 16628

NSE Nifty Weekly Candlestick Chart

Nifty Bank: 35372

Technical Outlook

• The daily price action formed a doji candle with shadows in either direction and a bearish gap above its head (35611 -35553 ) signalling continuation of the corrective trend . The index need to start forming higher high on a sustained basis and close above Wednesday gap down area for any technical pullback to materialise in the coming sessions

• Going ahead volatility is expected to remain high tracking ongoing geopolitical concerns and FOMC meeting . Index has major support placed around 34000 levels . Holding above the same will keep pullback option open towards 36700 levels . Further, a decisive close above 36700 levels along with cool off in VIX and crude oil prices will lead to a pullback rally towards 37800 levels in the coming month being the 61 . 8 % retracement of February decline (39424 -34991 ) .

• The index has support around 34000 levels being the confluence of the following :

• (a) lower band of the rising channel in place since last one year is placed around 34500 levels

• (b) the rising 52 weeks EMA is placed at 34688 levels

• (c) the previous major lows December 2021 is also placed around 34000 levels

• Among the oscillators the weekly stochastic is approaching oversold territory with a reading of 27 , signaling supportive effort is likely at lower levels in the coming weeks In the coming session, index is likely to open on a flat to positive note amid pullback in Global market . Volatility is likely to remain high on account of the volatile global cues . In today’s session we expect the index to witness pullback after last two sessions corrective decline . Hence use dips towards 35310 -35380 for creating long position for target of 35640 , maintain a stop loss at 35190

Nifty Bank Index – Weekly Candlestick Chart

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