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Sensex (59745) / Nifty (17822)

The US markets underwent a decent correction overnight and the Asian peers obviously reacted negatively to it. The SGX Nifty was indicating a gap down opening but we did not open that lower. In fact, after the initial nervousness, market stabilised and slipped into a consolidation mode throughout the first half. However, the buying emerged immediately post the mid-session which kept accelerating as we moved ahead. Due to good participation from the heavyweight spaces, Nifty went on to reclaim the 17800 mark by adding three fourth of a percent gains.

We clearly shrugged off negative cues from the global bourses and moved higher on our own. This indicates how overall strong the trend has been. Although, we have been sceptical of late, market is in no mood to correct. Yes we are in two minds, whether to stick to the recent stance or be with the trend. But as we have been highlighting lately, some of the time wise projections as well as negative divergences are still holding us back. Because such indicators may not provide precise timing but they would certainly be handy in giving early cautions. Hence, we reiterate and advise traders not to get carried away in this move.

As far as levels are concerned, 17900 – 17950 are to be seen as immediate hurdles; whereas on the flipside, 17700 – 17600 are the levels to watch out for. Although, it’s advisable not to trade aggressively, individual stocks are providing excellent opportunities, one can keep participating in it by maintaining strict stop losses.

Nifty Daily Chart

Nifty Bank Outlook - (37741)

We started the second day of the week with a downside gap. However, after some hiccups we witnessed smart buying interest in the midst to surpass previous day’s high. In the final hour of trade, the buying accelerated to almost touch 37800 and to finally conclude the session with the gains of 0.43%. Last three sessions recovery has certainly boost the overall sentiment of the market participants. We managed to conclude Friday’s session tad above 20 DEMA which has been acting as a strong demand zone lately. Technically, if we see any counter/index respecting 20 DEMA and has been trading above same is indeed a sign of strength. Going ahead, it would be interesting to see if the banking index manages to surpass the immediate hurdle around 38000 mark, if this happens then there are high possibilities of we extending the upmove beyond the record highs. On flip side, 37300-37400 is the key support zone now and until we remain in the range of 37300- 38000,its advisable to avoid any aggressive directional bets.

Nifty Bank Daily Chart

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