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Technical Outlook

Equity benchmarks started the week on a pessimistic note amid anxiety over US inflation, tightening of Fed policy and rupee hitting lifetime lows. The Nifty ended Monday’s session at 15774 down 427 points 2.6%. In the coming session, index is likely to open on a negative note tracking weak global cues ahead of US FOMC meet. The formation of lower high-low indicates continuance of downward momentum. Hence, use intraday pullback towards 15788-15820 for creating short position for the target of 15703

The index is currently poised at immediate support of 15700 which has been held on multiple occasions over past three months, despite elevated global volatility. Going ahead, on the breach below 15700 (on a closing basis) possibility of extended correction towards 15400 can not be ruled out. Meanwhile, to pause the ongoing downward momentum, a decisive close above previous sessions would be a prerequisite. On the upside, 16200 would act as key hurdle as it is Monday’s gap down area (16202-15878) coincided with 50% retracement of current decline (16793-15684)

Nifty Daily Chart

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