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Daily Technical View on Nifty

Market: Observation

* Markets ended with hefty gains on Thursday. The Nifty finally gained 216.85 points or 1.19% to close at 18,484.1. Broad market indices like the BSE Mid Cap and Small Cap indices gained less, thereby under performing the Sensex/Nifty. Market breadth was positive on the BSE/NSE.

Nifty: Breaks out of resistance at 18327

* Zooming into 15 min chart, we see Nifty initially opened with an upgap and then convincingly broke out of the 18327 resistance. It then gradually climbed during the day holding above the 20 period MA on the 15 min chart. A late surge in the last 30 min of trade ensured the Nifty closed above the recent swing highs of 18442.

* With the uptrend intact, Nifty could now target the life highs of 18604. Crucial supports to watch for weakness are now at 18393.

Nifty: Headed to lifetime highs

* On Daily chart, we observe that Nifty has broken out of a downward sloping trend line that has held down the highs of 2021 and 2022. In the process, the index is now comfortably trading above the 20 and 50 day SMA.

* Furthermore, with the Nifty clearing the recent swing highs of 18442 and the 14-day RSI not overbought at 67.17, we believe the Nifty is likely to take out the current life highs of 18604 in the coming sessions. A move below the 20 day SMA at 18182 would negate our bullish view.

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