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Nifty : 19443

Technical Outlook

• The index consolidated in a narrow range after initial decline. As a result, daily price action formed a bear candle carrying lower high-low, indicating breather after past two weeks up move. Nevertheless, Nifty small cap index endured its northbound journey and clocked a fresh All Time High, highlighting relative strength

• The cool off in US Dollar index and US 10 year yield amid softer US inflation reading bolstered the risk on sentiment. We expect, index to accelerate upward momentum and eventually challenge the milestone of 19700 in coming weeks as it is 61.8% retracement of Sep-Oct decline (20222-18838). In the process, stock specific action would prevail as we approach the fag end of the earning season coupled with global volatility. Hence, buy on dips would be the prudent strategy to adopt as strong support is placed at 19200. Our positive bias is further validated by following observations:

• A) The improvement of market breadth signifies broader market participation

• B) The breach of October low in Brent crude oil would provide impetus to equity market

• C) The drop in dollar index along with cool off in global yields would provide impetus for acceleration of up move

• The formation of higher low signifies supportive efforts at elevated support base that makes us revise the support base upward at 19200 as it is 50% retracement of past two weeks rally (18838-19464)

Nifty Bank: 43891

Technical Outlook

• The price action formed red candle as prices paused near psychological mark of 44000 ahead of weekly expiry session while lower shadow indicates existence of supportive efforts during intra day decline .

• The cool off in US Dollar index and US 10 year yield amid softer US inflation reading bolstered the risk on sentiment . This positive development makes us confident to believe, index would accelerate upward momentum towards 44700 as it is 61 . 8 % retracement of entire down move (46310 -42105 )

• Key short term support is placed at 43200 which we expect to hold in case of volatility, as it is a confluence of :

• 50 % retracement of past two weeks up move (42105 -44056 ) placed at 43080

• value of rising 200 days ema is placed at 43272

• Structurally, Index is in the process of undergoing a retracement of March to July rally while pricing in various negatives in the process . So far index retraced 18 week rall y by 50 % over 15 week correction indicating shallow nature of retracement . Since covid lows index held 52 - week ema on three occasions, followed by new high in each case in subsequent quarters

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