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Nifty : 22753

Technical Outlook

Day that was… Nifty extended its winning streak to record new closing high amid weekly expiry and ahead of key inflation data. It settled session at 22753, up 111 points or 0.5%. Midcap and small cap indices gained >0.7% each. Sectorally, Oil&Gas, Metal, FMCG and BFSI led the gains

Technical Outlook

* The index started the session on a positive note and gained further traction helped by banks in second half to close at days high. Days price action formed a small Doji candle which largely remained enclosed within previous session range indicating slow down of upward momentum or a breather after 1000 points rally over past three weeks led stochastics to overbought zone. Index is expected to gap down amid global volatility on Friday and could lead to profit taking after recent rally and index approaching closer to higher band of channel and short term hurdle of 22900

* Going ahead, we reiterate our structural positive stance and expect Nifty to head towards milestone of 22900 in coming week. The elongation of rallies followed by shallow retracement signifies robust price structure that makes us confident that Nifty would head towards our earmarked target of 23400 by the general election outcome. Over next few sessions a healthy retracement of recent rally would provide incremental buying opportunity as strong support is placed at 22300. Our positive bias is further validated by following observations:

* A. The Bank Nifty resolved out of three months consolidation (48600-44450) that has further strengthen the leadership of BFSI in next leg of up move

* B. The current up move is backed by broad based participation as Percentage of stocks above 50days ema rebounded strongly from its bearish extreme (20% levels) to current reading of 73%

* C. The index is showing resilience despite global volatility signaling pre-election rally is brewing up in tandem with historical election year price-behaviour

* D. Midcap index continues to post new highs while small cap is within 0.7% distance and expected to follow with new highs soon

* The formation of higher peak and trough on the weekly chart signifies inherent strength that makes us confident to revise support base at 22300 as it is confluence of:

* A) 20 days EMA placed at 22364

* B) 38.2% retracement of current up move (21710-22775), at 22368

Nifty Bank: 48986

Technical Outlook

Day that was : The Nifty Bank index gained for sixth session in a row continuing its record setting spree . Nifty Bank index closed at 48986 , up 256 points or 0 . 5 % . Private and Public banks both contributed to gains

Technical Outlook

* The Index commenced the session on a flat note but then quickly recovered yesterdays lost ground following by choppy consolidation near 49000 mark amid weekly expiry session . Price action formed a small doji candle with higher high -low formation indicating continuation of positive bias . While bias continues to remain positive as long as higher lows are maintained, index has hit overbought readings (daily stochastics 91 ) and forming small candles over past three sessions indicating signs of slow down in upward momentum . Hence a healthy retracement cannot be ruled out led by global volatility and reset of rate cut expectations .

* Structurally, index has given a breakout from three month consolidation last week indicating further upsides in coming weeks for the target of 49800 levels which is projection basis past one month trading range (48000-46200) . Meanwhile we expect index to hold key support of 47700

* Index has undergone healthy consolidation phase since late December 2023 which has set stage for next up move . Within this phase index has maintained its rhythm of forming higher lows near 52 -week ema indicating continuation of structural uptrend

* We are raising immediate support at 47700 as it is confluence of :

* A) 38 . 2 % retracement of recent up move (45828 -49057 )

* B) value of rising 20 -day ema at 47632

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