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Nifty : 22705

Technical Outlook

Day that was… Equity benchmarks concluded Wednesday’s session on a subdued note tracking weak global cues. The Nifty lost 183 points or 0.85% to settle the session at 22705. The market breadth remained in favour of declines. Sectorally, financials, IT, Oil & Gas underwent profit booking while pharma, metal relatively outperformed

Technical Outlook:

• The index witnessed a gap down opening (22888-22825) and inched southward as the day progressed. As a result, daily price action formed bear candle carrying lower high-low, indicating extended breather after recent sharp up move

• Going ahead, we expect elevated volatility to prevail as we approach fag end of the General election phases coupled with Q4 earning season and monthly expiry wherein strong support is placed at 22400. However, looking at the broader structure, we maintain our positive stance and expect Nifty to gradually resolve higher toward our earmarked target of 23400 in coming weeks. Thus, focus should be on big picture, as we are in structural uptrend. The anxiety will subside post event and markets will follow its structural up trend. Retracement of rally would thus provide a buying opportunity and therefore investors should focus on building portfolios and ride the uptrend. Our positive stance is corroborated by following observations:

• A) The index is taking breather after witnessing faster retracement wherein it entirely retraced past nine weeks consolidation (22800- 21700) in just two weeks hat bodes well for extension of ongoing up move

• B) In sync with the historical evidences, Nifty staged a strong rebound post 5% and clocked a new high, highlighting robust price structure. Empirically, index has corrected ~6% during polling phase of past four elections and eventually hit new highs around election outcome on three occasions

• C) The multi sector participation backed by improving market breadth (Amongst Nifty 500 universe, 77% stocks are trading above 200 days EMA), highlighting inherent strength

• D) Robust price stature of global markets and lower brent prices are expected to act as tailwind

• Structurally, formation of higher peak and trough makes us confident to revise support base upward at 22400 as it is confluence of 20 days EMA coincided with 50% retracement of current up move (21821- 23110) and last week’s low of 22404

Nifty Bank: 48501

Technical Outlook

Day that was :

The Nifty Bank index extended losses over second session in a row . Public sector banking index declined 0 . 5 % while Nifty Bank index closed at 48501 , down 1 . 3 %

Technical Outlook :

• The Bank Nifty index started the session on a subdued note and subsequently inched southward as intraday pullbacks were short lived .

• Price action thus formed a bear candle carrying lower high -low indicating breather after recent sharp up move .

• Structurally, the formation of higher peak and trough signifies robust price structure that makes us reiterate our positive bias and expect index to gradually head towards psychological mark of 50000 . Thus, dips to attract further buying demand since elevated support is placed at 48000 which is

• 80% retracement of past four session rally

• Value of rising 50-day ema

• Since late Jan’24 low of 44633 , Index is following a peculiar pattern that each 5 correction is followed by 7 % rally resulting into new highs to be made . This has resulted in a well channeled up move in Bank Nifty which is expected to head towards 50000 mark

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