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Nifty : 19497

Technical Outlook

• The index regained upward momentum after two sessions choppy move. Consequently, index logged a fresh All time high. The Daily price action resulted in a strong bull candle carrying higher high-low, indicating acceleration of upward momentum.

• The formation of higher peak and trough signifies elevated buying demand underpinned by strong improving market breadth as currently 78% stocks of Nifty 500 universe are trading above their 200 days EMA. Thereby, we reiterate our positive stance and expect Nifty to head towards 19700 for coming weeks as it is 138.2% external retracement of Dec-Mar decline 18887-16828. Key point to highlight is that past eight sessions 865 points rally hauled daily stochastic oscillator in overbought territory (placed at 94), indicating possibility of temporary breather can not be ruled out. However, dips should not be construed as negative instead capiatliased it as incremental buying opportunity as key support is placed at 19100.

• On the broader market front, Nifty midcap recorded a fresh All Time High and small cap index closed at 15 months high. Thus, temporary breather should be capitalized to accumulate quality stocks on set of earning season

• Structurally, the formation of higher peak-trough on the monthly chart signifies elongation of rallies that makes us confident to revise support base at 19100, as it is confluence of:

• a) since March Nifty has not corrected more than 400 points. In current scenario 400 points correction will mature at 19112

• b) 50% retracement of current up move (18645-19512), at 19080

Nifty Bank: 45340

Technical Outlook

• The day’s price action formed Bull candle as prices held Wednesdays low and gradually recovered towards end of the session . However broadly index continued its consolidation for third session in a range of 45000 -45800 indicating consolidation after over 2100 points gain in index in just six sessions led prices to short term overbought trajectory . However only a decisive close below past two sessions low at 45000 would indicate extended consolidation

• Going ahead, we expect, index to maintain its upward trend and head gradually towards 46300 in July as it s 138 . 2 % external retracement of Dec -Mar decline (44151 - 38613 ) . The breakout from six months consolidation backed by faster pace of retracement helped index to record a fresh All Time High and signals structural improvement from medium term perspective

• From structural perspective, any temporary breather from hereon would provide fresh investment opportunity to ride the uptrend wherein we expect PSU banks to now start catchup activity with private peers

• The formation of higher peak and trough on the larger degree chart makes us confident to revise support base at 44000 as it is 61 . 8 % retracement of most recent upmove from lows of 43300

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