The index started the session on a muted note and gradually inched southward as the day progressed - ICICI Direct
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Nifty : 21616
Technical Outlook
• The index started the session on a muted note and gradually inched southward as the day progressed. As a result, daily price action formed a bear candle carrying lower high-low, indicating profit booking in the vicinity of All Time High
• We believe, current profit booking in the broader market (Nifty Midcap) would find its feet around 46500 that would make market healthy and provide fresh entry opportunity in quality stocks as we approach the fag end of the earning season. In the process, Nifty would prolong the consolidation in 22000-21100 range. Thus, buying on dips would be the prudent strategy to adopt as strong support is placed at 21100. Our positive bias is further validated by following observations
• A) Most global indices inched up marginally to record new 52-week highs ahead of next week’s US inflation numbers
• B) steady oil prices and bond yields are likely to act as tailwind
• The formation of lower high-low on the weekly chart indicates short term corrective bias that makes us revise support base at 21100 as it is confluence of:
A. 61.8% retracement of mid Dec-Jan rally (20508-22124)
B. January 2024 low is placed at 21137
Nifty Bank: 44882
Technical Outlook
• The index started the week on a flat note and gradually inched southwards as intraday pullback were short lived . As a result, daily price action formed a bear candle engulfing previous day price action indicating corrective bias .
• Going ahead, to pause the ongoing corrective move index need to decidedly close above previous sessions high (45748 ) failure to do so would lead to prolonged correction towards 44600
• On the upside, index has failed to sustain above 50 -day average (46100 ) for past seventeen sessions making it an immediate resistance for coming week and only a decisive breach above that level would pave way for acceleration of momentum
• Short term support to 44600 -44800 is confluence of
• 61 . 8 % retracement of October – December rally (42105 -48636 ) at 44600 .
• Last weeks low at 45071
• rising 200-week ema (44665 )
• 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 .
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