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Nifty : 19080

Technical Outlook

• The index fizzled out initial gap up move (19140-19232) and settled the session on a subdued note. As a result, daily price action formed a bear candle carrying higher high-low, indicating breather amid stock specific action

• Going ahead, we expect index to extend the ongoing pullback towards 19450 in coming weeks as it is 61.8% retracement of last leg of decline (19850-18838). However, the move towards 19450 would be in a non linear manner as volatility would remain elevated ahead of US Fed meet.

• The broader markets have undergone healthy retracement wherein >75% percentage of stocks (Nifty 500 Universe) are trading above 200-day ema in October against March23 reading <40%, indicating shallow nature of profit taking amid robust price structure

• The formation of lower peak and trough amid global volatility makes us retain the support base for the Nifty at 18700 zone as it is confluence of 52 weeks EMA coincided with previous swing high of 18887 which would now act as key support as per change of polarity concept

Nifty Bank: 42845

Technical Outlook

• The price action for the day formed a bear candle as index failed to sustain opening gains indicating hurdle near 200 -day ema (43240 ) . Index however retained higher low on daily time frame

• Going forward, we expect index to gradually head towards 43800 levels in nonlinear fashion . Therefore, use dips as buying opportunity in large banks (private and PSU both) as we expect index to hold key support of 41800 . Key support is placed at 41800 levels as it is a confluence of :

• 61 . 8 % retracement of entire rally from March 2023 (38613 -46369),

• value of rising 52 -week ema which has been held on couple of occasions since CY2020 currently at 42700 (transitory breach usually is sign of capitulation)

• Structurally, Index is in the process of undergoing a retracement of March to July rally over while pricing in various negatives in the process . We believe current decline would lead to a strong higher base formation that would set the base formation for next leg of structural up trend

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