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Technical Outlook

Equity benchmarks hit fresh life highs on Thursday and settled the session at 17234, up 0.9% amid strong buying demand across, IT, consumption and banking stocks. In the coming session, index is likely to open on a positive note amid firm global cues. We expect the index to trade with positive bias while maintaining higher high-low. Hence after a flat to positive opening use intraday dips towards 17200-17230 to create long for target of 17315.

We believe a decisive close and sustainability above 17200 in coming session would open the door for next leg of up move towards revised target of 17600 in coming weeks. Else there would be positive consolidation in 17200-16900 range amid stock specific action that would make market healthy after past five week’s 11% rally that hauled daily and weekly stochastic oscillator in overbought territory, indicating round of temporary breather from here on can not be ruled out. Thus, any dip should be capitalised to accumulate quality stocks as over past 15 months buying on declines strategy has worked well for equity investors.

Nifty Weekly Chart.

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