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Nifty : 23810

Technical Outlook

Day that was ..

The equity benchmark continued with its northbound journey over fifth session in a row tracking decline in crude oil amid development on US midterm election outcome. Nifty settle the session at 23960, up 150 points or 0.6%. Market breadth remained sturdy with A/D ratio of 3:1 as broader market relatively outshone as Nifty Midcap and small cap gained 1.5% and 2%, respectively. Sectorally, barring IT all major indices ended in green led by Metal, Realty, consumption.

Technical Outlook :

• The market index commenced the day on an optimistic note and concluded the volatile trading session on a positive note. The daily price movement formed a sizable bullish candlestick, suggesting a continuation of the upward momentum.

• Index is likely to witness gap-up opening tracking buoyancy in global markets as US midterm election outcome and resultant sharp decline in brent crude prices boosted the market sentiment. The recent recovery of ~ 1500 points enabled the Nifty to regain its 200-day EMA after a twomonth hiatus. The retracement of the seven-week decline within just two weeks indicates a faster pace of recovery.

• Going forward, sustaining above the 200-day EMA would help index to extend the ongoing rally toward the 24300 mark, which represents an 80% retracement of the entire decline from August highs of 24774 to October lows of 22180.

• Additionally, a decline in crude oil prices and a cooling off in US 10-Year Bond Yields would further support the rally. Therefore, any dips moving forward should be seen as opportunities to accumulate quality stocks backed by robust earnings.

• On the market breadth front, we have observed significant improvement in the market breadth of Nifty 50 universe as reading of % of stocks above 200 days SMA has improved from 10 days back reading of 16% to 45%. This significant improvement bodes well for extension of ongoing rally

• The US midterm election results represent a critical near-term trigger. Historical data from the past 11 occurrences since 1982 indicate that, on eight occasions, the S&P garnered 10% average positive returns in next 3 months. In the meantime on six occasions Sensex achieved average positive returns of 12%.

• The formation of higher high-low signifies strong price structure that makes us revise support base upward at 23,500 being placement of the 100-days EMA.

• Structurally, the index has maintained its position above its April 26 panic low, which coincided with the long-term 200-week EMA, despite ongoing geopolitical uncertainties and the rise in crude oil prices and bond yields. Consequently, the past six months' price action appears to be forming a potential double-bottom pattern, setting the stage for a durable bottom market

Intraday Rational :

• Trend – Formation of higher high low signifies positive bias

• Levels – Buy around 50% retracement of Gifty Nifty 2 day range

Nifty Bank : 55913

Technical Outlook

Day that was :

Bank Nifty ended the session on a positive note, up 0.6% at 55914 levels. Meanwhile, the Nifty PSU Bank relatively outperformed by gaining 0.7% for the day.

Technical Outlook :

• The index started the day with positive opening and traded in a range and resumed its uptrend in second half. The daily price action formed is bull candle with higher high higher low intact indicating positive bias.

• Index is likely to witness gap-up opening tracking buoyancy in global markets as US midterm election outcome and resultant sharp decline in brent crude prices boosted the market sentiment. Key point to highlight is that Index is sustaining above last week high (55068) and also 50-day EMA signaling positive momentum.

• We expect index to resolve above immediate hurdle of 56000 mark and extend the move towards 57000 eventually being placement of falling trend line drawn adjoining Jun-Aug 2026 high.

• On the downside revised support is now placed at 55000 being placement of 50 days EMA

• Nifty PSU Bank Index formed inside day candle indicating breather. Going ahead we expect Index to consolidate in the range 8400-8100.

Intraday Rational :

• Trend - Robust recovery from key support of 53800 confirms strong support zone

• Levels : Buy around 61.8% retracement of recent decline.

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