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Sensex (59463) / Nifty (17698)

We had a flat start on Friday that was followed by an immediate intraday dip below the 17600 levels. However, with under tone strong bullish this dip got bought into as the benchmark gradually inched higher for the remaining part of the session to eventually end with gains of 0.22% tad below 17700

Technically speaking, the winning streak in the index has brought it towards the sloping trendline on the weekly chart, which might be considered as the major hurdle for the index in the near period. Also, the recent upward move has been vertical in nature, so one should not rule out the possibility of profit booking at the critical resistance zone. And any sort of correction in the near term should be considered healthy post such a strong rally, as structurally, we may get a higher bottom. The undertone is likely to remain strongly bullish, and any dip towards the consolidation zone of 17150-17400 could be seen as an opportunity to add new longs in the index from a directional point of view. As far as levels are concerned, 17780-17800 is the crucial supply zone, and any decisive breach above the same could only trigger the next set of rallies in the index.

Nifty Bank Outlook (39042)

On Friday, Bank Nifty started on a positive note however along with the benchmark index it slipped lower during the initial first half an hour. This dip got bought into not only to erase the morning loss ground but to end well above Thursday's high gaining 0.42% to close a tad above 39000.

Bank Nifty has been a clear outperformer for the last few weeks and bulls have become adamant with every small dip getting bought into. Now Bank Index is approaching key levels of Feb swing high around 39400 levels that is also high for the current calendar year. Even though the undertone is strong bullish the momentum since the last few days have slowed down and with oscillators in the overbought zone, we would closely watch Bank Nifty around 39400 - 39500 levels. Ideally, traders should look to book profits in long in this zone and wait for healthy time-wise or price-wise correction to re-enter. As far as immediate support is concerned, the bullish gap left around 38650 - 38400 is seen as strong support. At such elevated levels, traders are advised to be very selective and avoid undue risk.

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