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NSE (Nifty):14895

Technical Outlook

* The index started the derivative expiry session with a positive gap (14865-14979) and approached the psychological mark of 15000. However, profit booking from higher levels hauled index below 14900 mark. As a result, the daily price action formed a bear candle carrying higher high-low, indicating breather after past five sessions ~900 points rally. In the process, small cap index scaled to new 52 weeks high

* Going ahead, a decisive close above upper band of falling channel (placed at 14900) would be required to confirm the breakout from falling channel which would lead to acceleration of upward momentum, else extended consolidation with positive bias. In the process, we expect broader market to outperform as stock specific action would prevail amid progression of Q4FY21 result season

* Key point to highlight is that, the current up move (893 points) is larger in magnitude compared to early March rally of 868 points. The elongation of up move signifies rejuvenation of upward momentum that augurs well for next leg of up move. Therefore, any temporary cool off from here on should be capitalised as an incremental buying opportunity in quality large and midcaps

* The Nifty small cap index resolved out of past two months consolidation and clocked a fresh 52 weeks high, highlighting robust price structure. We expect, broader market indices to endure their relative outperformance wherein small cap would witness catch up activity as Nifty midcap index is hovering at its all time high whereas small cap index is still 11% away from its life highs

* Structurally, we believe any dip from here on would get anchored around 14200 as it is confluence of:

* a) Lower band of past two months falling channel placed at 14200

* b) 100 days EMA is placed at 14200

* c) Last week’s panic low is placed at 14151

In the coming session, index is likely to open on a negative note tracking subdued Asian cues. We expect index to hold Wednesday’s gap area (14653-14695), hence post gap down opening use intraday dip towards 14700-14725 to create long for target of 14814.

NSE Nifty Daily Candlestick Chart

Nifty Bank: 33714

Technical Outlook

* The daily price action formed a high wave candle which maintained higher high -low highlighting intraday volatility and a overall positive price structure . Index has recently registered a breakout above the falling channel containing entire decline signalling end of corrective phase and resumption of the primary uptrend

* Going ahead, we expect the index to maintain positive bias and gradually head towards 34900 levels in the coming weeks as it is the 61 . 8 % retracement of the entire decline (37708 - 30405 ) .

* The index in the last six sessions has witnessed a strong up move of more than 3500 points which has lead to daily stochastic into overbought territory with reading of 92 , so some profit booking at higher levels can not be ruled out . We believe that it should not be seen as negative instead it should be capitalised to accumulate quality banking stocks for up move towards 34900 levels

* The index maintained the rhythm of not correcting more than 20 % as witnessed since March 2020 . In the current scenario it rebounded after correcting 19 % from the all -time high (37708 ) . Hence it provides favourable risk -reward setup for the next leg of up move

* The index has immediate support at 32000 levels being the confluence of the current week low and the 50 % retracement of the current up move (30405 -34287 ) . While the major support is placed in the range of 30500 -30000 levels

* In the coming session, the index is expected to open gap down . Volatility is expected to remain high as buying demand is likely at lower levels . Hence, after a negative opening use dips towards 33100 -33170 for creating long position for the target of 33390 , maintain a stoploss of 32990

Nifty Bank Index – Daily Candlestick Chart

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