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Nifty : 17812

Technical Outlook

• The Nifty commenced the session on a positive note and then stayed above 17700 mark during first half, while heavyweight private banks led index beyond March highs of 17800 during second half. As a result price action formed a bull candle with continuation of higher high-low formation. Expectations of pause in interest rate hike cycle globally kept sentiments buoyed ahead of Wednesdays US CPI data which will be key monitorable for further market direction

• Nifty gained almost 1000 points from March low of 16828 and surpassed previous month high for first time since December 2022 indicating positive turnaround on monthly timeframe. However, given sharp rally of past few sessions has led daily stochastics in overbought trajectory. For coming session, sustainability above 17800 would lead to further acceleration of ongoing momentum else minor profit booking cannot be ruled out. Structurally, index has remained on the expected path and achieved our short term target of 17800 on Wednesday. We expect index to gradually head towards 18100 in April and short term dips if any would offer incremental buying opportunity. Our positive view is further validated by following observations:

• a) The current pullback of 997 points is strongest in magnitude since life highs recorded in December 2022, indicating structural improvement

• b) On the momentum indicator front, Rate of Change indicator is at 5 month high (on multiple parameters), indicating revival in upward momentum

• c) Current up move is backed by robust market breadth as 80% components of Nifty 500 universe have given positive returns during this period, while percentage of stocks above 200dma has improved from a low of 32 in March to current reading of 49 marking stark improvement

• We expect broader markets to witness catch up activity as Nifty midcap and small cap indices are sustaining well above their past two weeks high, indicating resumption of upward momentum

• Structurally, the formation of higher high-low on the weekly chart makes us confident to elevate short term support base at 17300 as it is 50% retracement of recent pullback (16828-17748) coincided with prior week’s low (17312)

In the coming session, trajectory of yields, dollar index and VIX would be key monitorables post US CPI data. index likely to open on a flat note amid mixed global cues. We expect index to trade in a range with positive bias amid stock specific action. Hence, use intraday dips towards 17770-17805 in April future for creating long position for target of 17887, maintain a stoploss at 17733

Nifty Bank: 41557

Technical Outlook

• The daily price action formed a bull candle with a higher high -low signalling continuation of the overall positive bias ahead of the US and India CPI numbers

• Going ahead, we expect the index to maintain positive bias and head towards 42000 levels in coming weeks being the confluence of the high of February 2023 and 61 . 8 % retracement of the entire corrective decline (44151 - 38613 )

• Index has already seen a up move of more than 2200 points in just three weeks which has lead to daily stochastic at overbought territory with a reading of 83 hence a couple of days of breather cannot be ruled out . However, immediate bias continues to remain positive as index is forming higher high -low in daily chart

• Bank Nifty/Nifty ratio line continues to trend higher and sustaining above the major breakout area signalling continuation of the outperformance

• The index has support at 40500 levels being the confluence the last week low and the 50 % retracement of the last three weeks pullback (39273 -41610 )

• The weekly stochastic remain in up trend and is seen sustaining above its three periods average thus supports the overall positive bias in the index In the coming session, the index is likely to open on a flat note amid mixed global cues . Index is expected to trade in a range with positive bias while maintaining higher high -low . Hence use intraday dips towards 41390 -41470 for creating long position for the target 41690 , maintain a stoploss of 41270.

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