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Nifty : 23567

Technical Outlook 

Day that was

Equity benchmarks concluded weekly expiry session on a positive note amid rise in volatility. Nifty gained 50 points to settle the session at 23567. Market breadth turned positive with A/D ratio of 1.8:1 as broader market outperformed the benchmark. Sectorally, financials, metal, realty outperformed while auto, pharma took a breather

Technical Outlook:

* The index started the session on a muted note and gradually inched northward as the day progressed. The daily price action formed an inside bar, indicating breather amid stock specific action

* The across sector participation backed by improving market breadth signifies inherent strength that makes us reiterate our positive stance and expect Nifty to gradually head towards 23800 in coming weeks

* In the process, temporary breather after 11% rally (from June low) cannot be ruled out. However, such breather should not be construed as negative instead capitalised it as incremental buying opportunity as strong support is placed at 23000.Our positive bias is further validated by following observations: a. We believe, revived traction in Bank Nifty would provide impetus for Nifty to resolve higher as Bank Nifty carries ~35% weightage in Nifty b. Market breadth has shown renewed optimism as stocks above 50-day ema has improvised from 51% just before elections to 88% c. Buoyancy in US markets bodes well for domestic market as it has direct correlation with the developed market

* Structurally, the formation of higher peak and trough signifies elevated buying demand that makes us retain support base at 23000 as it is 20 days EMA

Nifty Bank: 51783

Technical Outlook

Day that was

Nifty Bank extended winning streak for fourth session in a row on Thursday . Nifty Bank index closed at 51783 up 385 points or 0 .75 % . Nifty private banks continued to lead with 1 % gain

Technical Outlook :

* The price action for the day formed small bull candle which remained enclosed within previous session range resulting in inside bar, which is a sign of breather

* Going forward, we expect index to continue its upward trajectory and gradually head towards 53000 levels, where current up move from election day low (46077 ) would equate with previous two major rallies since October 2023 measuring 15 % each

* Key observation is that since October 2023 , each of intermediate correction of 9 % was followed by 15 % rally . We expect same rhythm to be maintained and index to head towards 53000 mark in coming few weeks

* In the process, immediate support is now being raised to 49900 being current week low that coincide with 38 . 2 % retracement of rally from election day lows

* PSU Bank index continues to undergo healthy consolidation in a narrow range amid multiple banks undergoing fund raise . Price structure however remains positive and prospects of lower bond yields may trigger further buying demand for PSU banking stocks in coming months

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