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Daily Technical View on Nifty

Market: Observation

* Markets ended with modest gains on Thursday after a gap up opening. Nifty finally gained 41.3 points or 0.17% to close at 24,811.5. Broad market indices like the BSE Mid Cap and Small Cap indices gained more, thereby outperforming the Sensex/Nifty. Market breadth was positive on the BSE/NSE.

Nifty: Short term uptrend looks set to continue

On Nifty 15 min chart, we can observe that Nifty bounced back from close to the 50 period MA on Wednesday and is now consolidating in a tight range above the 50 period MA. This indicates that the near term uptrend is intact.

Crucial supports to watch in the very near term are at 24784-24654.

Nifty: Daily chart indicates uptrend could continue

* The daily timeframe indicates that Nifty has broken out of a range after consolidating above the 50 day SMA last week.

* Nifty has also filled the upper gap area at 24687 as it closed above it on Tuesday. We can therefore expect the Nifty to head towards the current life highs of 25078. Momentum indicators like the 14-day RSI too have bounced back from their recent lows and at 60.44 is not overbought. Our bullish bets will be off if the Nifty corrects and moves below the recent swing lows of 24099.

* Sectorally, most of the sectoral indices are looking positive on the charts. The stronger sectors are Bank Nifty, FMCG, PSU Banks and Metal.

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