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Nifty

• The Nifty started the session on a subdued note and gradually drifted downward as the day progressed. The daily price action formed a bear candle carrying a lower low over a fourth consecutive session, indicating an extended breather

• We believe the ongoing breather would make market healthy by cooling off overbought conditions (daily stochastic slipped to 24) and form a higher base that would gradually pave the way to challenge 18900 mark and eventually head towards 19400 in coming weeks. We believe the move towards 19400 would be in a non-linear manner as bouts of volatility amid global development cannot be ruled out. In the process, we expect broader markets to relatively outperform as it resolved out of three month’s higher base formation. Thus, extended breather from here on should be capitalised on as incremental buying opportunity as strong support is placed at 18300. The aforementioned positive stance is further validated by following observations:

• a) breakout from 13 month’s consolidation signifies resumption of structural up trend • b) Dow Jones Industrial retraced the last falling segment’s high faster as nine week’s decline was retraced in six weeks for the first time since January 2022 highs

• c) Dollar Index and US 10 year yields continued to form lower highlows after breaking from rising channels indicating further downsides. Both have inverse correlation with equities

• Nifty midcap index maintained its upward momentum post triangle breakout. We expect it to resolve higher and challenge all-time high with small cap accelerating catch up activity in coming weeks

• Structurally, elongation of rallies along with shallow retracement indicates inherent strength that makes us confident to retain support base upward at 18300 as it is confluence of: a) as per change of polarity concept January high of 18350 would now act as key support b) last week's low is placed at 18365

• In the coming session, index is likely open on a muted note tracking subdued global cues. Post initial decline we expect supportive efforts to emerge from 18600. Thus, intraday dip towards 18610- 18642 should be used to create intraday long positions for target of 18726

Nifty Bank

• The daily price action formed a high wave candle with shadows in either direction signalling continuance of the consolidation after sharp up move measuring 15 % in past nine weeks

• We expect the index to maintain positive bias and head gradually towards 44600 levels in the coming weeks being the 161 . 8 % external retracement of the September 2022 breather (41840 -37387 ) . Dips should be used as a buying opportunity index has strong support placed around 41800 levels

• Going forward, a temporary breather cannot be ruled out as the weekly stochastic after the recent sharp rally is placed at an overbought territory with a reading of 91 . However, it will be confirmed only on formation of a lower high -low sequence . We believe corrective decline should not be seen as negative instead breather towards the breakout area of 41800 levels should be used as a buying opportunity for next leg of up move

• Structurally, in the Bank Nifty rallies are getting faster and stronger while corrections are shallow, underpinning inherent strength highlighting robust price structure

• The Bank Nifty has support at 41800 mark being the confluence of the (a) 23 . 6 % retracement of the last nine weeks up move (37387 -43515 ) placed at 41970 (b) the 10 weeks EMA currently placed at 41770 levels (c) the upper band of the recent eight weeks range breakout area placed around 41800 levels In the coming session index is likely to open on a flat note tracking muted global cues . We expect the index to continue its consolidation with positive bias after recent strong up move . Hence use intraday dips towards 43080 -43170 for creating long position for the target of 43430 , with a stoploss of 42980

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