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Nifty : 19526

Technical Outlook

• The index witnessed a gap down opening and gradually inched southward as intraday pullbacks were short lived. As a result, daily price action formed a sizable bear candle carrying higher high-low, indicating extended correction on the breach of past two week’s low of 19560.

• The breach of past two week’s identical low of 19563 signifies extended profit booking. Going ahead, we expect index to extend ongoing corrective phase towards lower band of broader consolidation placed at 19200. In the process, stock specific action would prevail amid progression of earning season. Key point to highlight is that, secondary correction is part of a structural bull market which will make market healthy. Thereby, dips should be utilized to accumulate quality stocks in a staggered manner

• In tandem with the benchmark, broader market underwent profit booking after 4 months spectacular rally of 30% (in Nifty midcap) index hauled weekly Stochastic oscillators in overbought condition (placed at 95), indicating possibility of extended breather. Thus, focus should be on accumulating quality stocks on dips in a staggered manner

• We believe, any extended correction from hereon would get anchored around key support of 19200 as it is confluence of:

• A) 61.8% retracement of current up move (18645-19991), at 19160

• B) 50 days EMA is placed at 19136

• C) July month’s low is placed at 19234

Nifty Bank: 44995

Technical Outlook

• The price action for the day formed bear candle with gap (45404-45592) above its head indicating further loss of positive momentum . In the process index breached lower band of its upward channel (45200 ) indicating extended profit booking

• Going forward current week’s high of 45782 remains key short term resistance below which corrective bias will continue

• Key support for short term is placed at 44500 which is low of July 2023 that coincides with rising 50 -day ema (44646 )

• Structurally we expect PSU banking stocks to relatively outperform their private banking peers

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