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Nifty : 21462

Technical Outlook

Day that was… Equity benchmark edged lower tracking muted global cues. The Nifty settled Thursday’s session at 21462, down 110 points or 0.5%. The market breadth remained flat as broader market relatively outperformed. Sectorally, pharma, PSU Bank, Oil & Gas relatively outperformed while financials, metal remained under pressure

Technical Outlook

• The index witnessed a gap down opening (21572-21414) and drifted lower. However, supportive efforts from 21300 mark helped index to recover some of intraday losses. Consequently Nifty managed to hold the key support of 21450 on the closing basis. Daily price action resulted into Doji like candle carrying lower high-low, indicating corrective bias amid elevated volatility.

• Going ahead, holding lower band of rising channel on a closing basis (as shown in chart) would keep pullback option. Failure to hold key support threshold of 21450 would lead to extended correction. Thus, formation of higher high-low would be the prerequisite to pause the ongoing correction. Meanwhile, 21900 would act as immediate resistance in coming sessions.

• Structurally, index is undergoing breather after 17% rally seen over past two months. However, formation of higher peak and trough on the larger degree chart signifies robust price structure. Thus, focus should be on accumulating quality stocks in a staggered manner amid ongoing earning season.

• The sequence of shallow retracement followed by elongated rallies signifies inherent strength that makes us confident to retain support base at 21450 as its is confluence of: A) Lower band of rising channel as shown in adjoining chart B) 61.8% retracement of past four week’s up move 20976-22124 C) Past three weeks low is placed at 21450

Nifty Bank: 45713

Technical Outlook

Day that was :

The Nifty Bank index extended its decline for another session on Thursday amid ongoing profit booking in large private banks amid earnings disappointment . Nifty Bank index closed ta 45713 , down 351 points or 0 .76 %

Technical Outlook :

• The index started the session with yet another gap down action however then witnessed some recovery midway through the session before surrendering gains Price action resulted in a bull candle with long higher shadow indicating continued selling pressure during intraday recovery

• Going forward, short term bias remains negative with strong resistance placed at 46700 mark and first sign of abating down ward momentum will be formation of higher high -low on daily charts

• On the down side, next important support for index is placed at 45400 levels which is a confluence of :

• rising 20 -week ema (45800 ) which is being held on many occasions during bull market corrections

• 50 % retracement of entire rally (42105 -48636 ) at 45370

• Low of strongest weekly bull candle of 8 th December 2023 (45484 )

• Structurally, index is undergoing a healthy retracement of November – December rally wherein it gained around 15 % over 9 week period . Index has so far retraced 38 % of the rally over past three weeks and further corrective towards 45700 would only help prices to come out of overbought trajectory . Meanwhile, PSU banks are exhibiting strength and likely to outperform

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