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Nifty : 24320

Technical Outlook

Day that was…

Equity benchmarks witnessed range bound activity near All Time High range. Nifty settled Monday’s session at 21340. Broader market performed with benchmark. Sectorally, barring FMCG, Oil & gas all other indices ended in red weighed down by Consumer Durables, PSU Banks

Technical Outlook:

* The index witnessed a lackluster session as Nifty oscillated in 100 points range throughout the session. As a result, daily price action resulted into doji like candle, indicating range bound activity wherein stock specific action prevailed

* Going ahead, we expect Nifty to continue to trade with a positive bias and gradually head towards our earmarked target of 24700 by July 2024. Key point to highlight is that, past five week’s sharp up move of 15% has hauled weekly stochastic oscillator in overbought territory (placed at 95). Thus, possibility of temporary breather at higher levels cannot be ruled out ahead of budget coupled with onset of Q1FY25 earning season. Hence, any dip from hereon should not be construed as negative instead capitalized it as buying opportunity as key support is placed at 23700. Our positive bias is further validated by following observations:

* A)The formation of higher peak and trough supported by sturdy market breadth signifies inherent strength (currently 86% of stocks trading above 50 days EMA)

* B) Global set up continues to remain strong footing and barring minor retracements does not flag bigger volatility

* Structurally, the elongation of rallies followed by shallow retracement signifies buying at elevated support base that makes us revise support base at 23700 as it is 20 days EMA coincided with 61.8% retracement of past two weeks up move 23350-24401

Nifty Bank: 52426

Technical Outlook

Day that was :

Nifty Bank index extended decline for second session on Monday to start the week on muted note . NiftyBank Index closed 234 points or 0 .45 % lower at 52425 . On relative terms private banks performed better than their public peers

Technical Outlook :

* The index commenced the session on a muted note amid extended profit taking amid concerns over deposit growth of large banks . Index then traded in a narrow range for 52700 - 52250 for rest of the session while closing near open . Price action formed a high wave candle with lower high -low indicating continuation of corrective bias . Over past seven sessions index has failed to sustain above 53000 mark and consolidated in a broad range of 52000 -53500 on expected lines

* Going forward, we expect this consolidation to continue owning to overbought readings on weekly time frame amid progression of earnings

* PSU banking stocks have witnessed extended profit taking/consolidation over few weeks and expected to form a higher bottom formation over next few sessions

* Meanwhile, we revise short term support to current week’s low of 52000 which also coincide with rising 10 -day ema that has been held since election outcome over past nineteen sessions

* Price structure : We observe that index is maintaining its higher high -low formation on multiple time frames and remain in steady uptrend and short term declines are attracting buying support . Hence consolidation in the short term will help index to undergo higher base formation and work out of overbought readings

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