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Sensex (60138) / Nifty (17930)

Last week’s corrective move was followed by a decent gap up opening to kick-start the festive week on a cheerful note. In the initial hour, market gave up some gains but fortunately at lower levels, the strong buying emerged across the broader market. In fact as the day progressed, the buying momentum accelerated to reclaim the 17900 mark.

Eventually, Nifty ended the session with nearly one and half a percent gains. Markets were extremely oversold and after testing the key support of 17600, some respite was on cards. It’s certainly a good start as we have stepped into a Diwali week. Generally market do not correct in this week and looking at yesterday’s strong rebound, market seems to be repeating the history. However we are still not completely out of the woods as we can see multiple hurdles in the vicinity of 100 – 150 from hereon.

Technically speaking, Nifty has precisely closed at the ‘200-SMA’ on the hourly chart and not far from here, we can see previous important support zone of 18000 – 18100, which is now likely to act as strong resistance. Hence, unless we do not surpass 18100 and stays above it, we may see some profit booking to come again. Hence, momentum traders are advised not to get carried away, till the time important levels are not reclaimed. On the flipside, 17800 followed by 17700 are to be seen as immediate supports.

Nifty Daily Chart

Nifty Bank Outlook - (39764)

We had a cheerful start for the week tad above 39400. Post some hiccups in the initial two hours of trade, the banking index witnessed some buying interest during the remaining part of the day to surpass Friday’s high. Eventually, we concluded the day adding handsome gains of 1.66% to the previous days close. Last week, the BankNifty corrected from its record highs of 41829.60 to plunged below 38500. The bears had formed strong grip throughout the previous week and market appeared a bit oversold.

Yesterday, finally we saw some respite which was certainly due after the fall seen in the last week. However, we shouldn’t can carried away in such recovery as the overall picture still remains uncertain. Going ahead, the banking index is likely to face resistance around 40000-42000 and on the lower side, support is placed at 39000 and 38700.

Nifty Bank Daily Chart

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