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Sensex (57897) / Nifty (17233)

Monday’s spectacular recovery was followed by a decent bump at the opening yesterday, citing to positive mood across the globe. The index extended its early lead a bit to surpass the 17200 mark and then slipped into a consolidation mode. All of a sudden at the stroke of the penultimate hour, market came off sharply on the back of some profit booking. Fortunately this tiny dip got bought into as Nifty went on to conclude the session around day’s high by reclaiming 17200.

Last week, around the same time, things were looking a bit dicey but in such a short span, we are back to the safe terrain comfortably above 17000. Now with recent price development, the base seems to have shifted higher towards 17000 – 16800 and till the time we do not slide below it, there is no reason to worry for. Before this, 17100 is to be considered as intraday support. On the flipside, the Nifty has now entered a key resistance zone of 17200 – 17300. With reference to recent commentary, if bulls have to regain their dominance, they need to conquer this sturdy wall with some authority. In order to achieve this, it needs a solid support from banking giants, because the initial lifting of the market was done predominantly by the IT counters and now it’s time for financial space to prove its significance. Let’s see how things pan out over the next couple of sessions as we are not only approaching the monthly expiry but also the calendar year end.

In our sense, if any major action has to happen, it will happen in the new year itself. Hence, for next couple of days, the pragmatic approach would be to keep focusing on individual themes which are continuously providing better trading opportunities.

Nifty Daily Chart

Nifty Bank Outlook - (35184)

In the last trading session, NIFTY BANK witnessed a lackluster day of trade and underperformed the benchmark index to settle below the crucial resistance zone of its long-term exponential moving average. Despite some traction in PSU banks, the index failed to showcase a strong closing.

The index managed to hold the 35000 mark, however, the buoyancy in the buying is yet to be seen that is expected above the resistance zone of 35500-35700, while on the flip side, strong support is seen near 34400-34500 zone. On technical parameters, the 14period RSI has seen a positive crossover to the signal line indicating an initial sign of bullishness in the index. Hence, for the time being, it is advisable to stay cautious at these levels and focus more on selective counters.

Nifty Bank Daily Chart

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