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Sensex (63143) / Nifty (18716)

The Indian equity markets started on a positive note tracking the sharp rally in the US bourses on the hopes of a pause in the Fed rate hike. The benchmark index stayed at higher ground throughout the session, suggesting a bullish undertone for our market. Though post the start, there was no major traction in the index and eventually, it settled a tad above 18700, procuring 0.62 percent for the day.

Technically, Nifty once again is hovering near the upper band of the consolidation awaiting a positive trigger to witness a breakout. As far as levels are concerned, the 18600 zone is likely to cushion any blip in the coming period, while the sacrosanct support lies around the 18500 mark. Meanwhile, the global markets should be watched closely as any further relief could act as a catalyst to open up the next leg of the rally towards the lifetime high zone of 18888.

Exhibit 1: Nifty Daily Chart 

Nifty Bank Outlook (44080)

The Bank Nifty started the day with a slight negative tone, but quickly gained positive momentum within the first few minutes. However, as the day progressed, there was a gradual decline in the mid-session, causing the bank index to fall back below the 44000 level. Fortunately, there was a second round of buying that exceeded the morning highs and resulted in a gain of about 0.31%, just below 44100.

On the daily chart, Yesterday's candlestick completely engulfed Monday's candlestick, which is a positive sign for the bulls as it occurred at a key support level of the 20EMA. Although there were no significant price changes, the formation appears promising and there is a possibility of the index retesting the 44300 - 44500 levels in upcoming sessions. On the other hand, the support levels of 43800 - 43700 remain crucial and any downward movements towards these levels should be seen as a buying opportunity. As the banking sector appears to be coming out of its recent slumber phase, traders should focus on stocks within this sector as they are likely to experience significant upward movement in the near term.

The technical structure looks robust and with the closure, it is highly anticipated that the index should carry the momentum in the near period. Simultaneously, the broader market is keeping the buzz, and one needs to focus on a stock-centric approach for better trading opportunities while staying abreast with global developments.

Exhibit 2: Nifty Bank Daily Chart

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