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Nifty :24189

Technical Outlook

Day that was…

Equity benchmark extended gain over 2nd session in a row. Nifty surged 445 points to settle the weekly expiry session at 24188. Market breadth remained sturdy with A/D ratio of 1.8:1 signaling broader market outperformance. Sectorally, all indices ended in green led by Auto, IT, Consumer Durables and Financials

Technical Outlook:

* The index started session on a positive note and endeared its northbound journey as intraday dips were short lived. As a result, daily price action formed a strong bull candle carrying higher-high low formation and managed to close above previous weeks high indicating continuation of positive bias as buying demand emerged from 200 days EMA coincided with 80% retracement of the previous up move (23263-24857). Consequently, Nifty reclaimed 24000 mark after nine sessions.

* On expected lines, index resolved higher and recorded breakout from past 2 weeks consolidation, indicating continuation of positive bias. Key point to highlight is that, stock has retraced past seven sessions up move in just two sessions. Faster pace of retracement on the smaller degree chart bodes well for extension of ongoing pullback. As a result, for the first time in past 9 trading sessions index managed to close above the gap zone (24150-24065) coupled with a decisive close above 20 Day EMA. The revival in upward momentum makes us reiterate our constructive stance and expect Nifty to head towards 24400 in coming weeks.

* Structurally, index has formed a strong base formation above long term rising trend line (drawn adjoining subsequent lows off June22), indicating robust price structure. The formation of higher highlow makes us confident to revise support base at 23700 which is confluence of 61.8% retracement of the 3 days rally (23,460– 24,226) and the 200-Day EMA placed around 23,700.

* The broader market fared well compared closed above 20 Day EMA after 8 days corrective phase backed by improvement in market breadth, indicating revival in broader market wherein supportive efforts emerged from 100 days EMA. Hence, accumulating quality stocks on dips would be the prudent strategy to adopt ahead of Q3FY25 earning season

Nifty Bank : 51605

Technical Outlook

Day that was:

Bank Nifty continued the bullish momentum from previous session and settled the day on a positive note at 51605, up by 1.07%. Meanwhile, Nifty PVT Bank index relatively outperformed the benchmark by closing positive by 1.41%.

Technical Outlook:

* The Bank Nifty witnessed a rangebound action in the first half of the session. However, the momentum picked up in second half where the bulls took the upper hand and pushed index towards the higher end of the consolidation range (50500-51600). As a result, the daily price action created a big bull candle indicating upside strength.

* Going ahead, we expect the bullish momentum to continue where the next leg of up-move is placed at 52600 which is 61.8% retracement mark of the recent decline.

* Structurally, the index attracted buying demand at the lower end of the long term trendline where it has taken support on multiple occasions ( drawn adjoining subsequent lows since Mar-23). The weekly momentum indicator RSI bounced from the multi-support zone indicating impending pullback on higher timeframe

* In tandem to the benchmark index, the PSU Bank index is moving in a rising channel where it has witnessed supportive effort from the lower band and observed a follow through buying thus, creating a hammer candle on daily chart. The daily stochastic oscillator witnessed a bullish crossover indicating accelerated up-move.

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