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Nifty : 21726

Technical Outlook

Day that was…

Equity benchmarks concluded interim Budget session on a flat note. Nifty settled the session at 21697, down 28 points. The market breadth turned slightly in favour of decline as midcap relatively underperformed. Sectorally, PSU Banks, auto, FMCG outperformed while metal, pharma relatively underperformed

Technical Outlook

• The index pared initial gains and gradually drifted downward as the day progresses. The daily price formed a small bear candle, indicating breather amid stock specific action

• Going ahead, we expect index to gradually resolve higher and challenge the All Time High of 22124 in coming weeks. In the process, we expect volatility to subside and focus to shift towards earning season and global cues. Thus, dips should be capitalized as incremental buying Opportunity as we expect Nifty to hold the key support threshold of 21100.

Our positive bias is further validated by following observations :

• A) Bank Nifty has bounced from key support threshold of 200 days EMA amid oversold conditions, indicating impending pullback which would fuel the pullback rally in Nifty (as Bank Nifty carries 35% weightage in Nifty)

• B) The rejuvenation of upward momentum in global market signifies firm global cues that would provide impetus to domestic market

• The formation of lower high-low on the weekly chart signifies pause in upward momentum that would makes us revise support base at 20800 as its is confluence of: A. Price parity of last leg of decline 22124-21285 projected from Tuesday’s high of 21750 B. 38.2% retracement of past two months up move 18838- 22124

Nifty Bank: 45996

Technical Outlook

Day that was :

The Nifty Bank inched up on Thursday to conclude budget session on a positive note led by PSU banks . Nifty Bank index closed at 46188 , up 198 points or 0 . 4 %

Technical Outlook :

• The index started the session on a muted note and then traded in a narrow range of 45800 -46200 for rest of the session while PSU banks outperformed as bond yields softened post budget . Price action for the day formed a doji candle with lower shadow that carried higher high - low indicating supportive efforts on intraday declines . Current pull back is now strongest and would lead index towards last week high of 46500 that also coincides with 50 % retracement of past one month decline (48636 -44429 )

• Going forward, we expect market to focus back on earnings and global cues wherein buy on dips strategy should be adopted with focus on PSU banks, HFCs and gold finance companies which look attractively poised . We expect index to hold December and January identical lows of 44500 as it is confluence of : • rising 52 -week ema (44150 )

• 61 . 8 % retracement of rally (42105 -48636 ) at 44600 • Equality of current decline with July -Oct 2023 decline ( 9 % ) at 44250

• Structurally, index is undergoing a retracement of November – December rally wherein it gained around 15 % over 9 week period . Index has so far retraced 50 % of the rally over past three weeks and expected to further undergo consolidation while PSU banks are exhibiting strength and likely to outperform

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