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Nifty : 22041

Technical Outlook

Day that was…

Equity benchmarks endured its winning streak over sixth consecutive session and recorded fresh All Time High of 22215. The Nifty settled the session at 22197, up 75 points or 0.3%. Market breadth remained flat as Small cap index relatively underperformed by losing 0.5%. Sectorally, financials remained in focus while IT, auto, metal remained under pressure

Technical Outlook

• The index started the session on a flat note. However, buying demand from Monday’s low 22021 helped index to clock a fresh Lifetime high. Consequently, daily price action formed a sizable bull candle carrying higher high-low, indicating continuation of upward momentum

• The sustenance above past five weeks consolidation breakout signifies inherent strength that makes us confident to revise target to 22700 for coming weeks as seasonal correction in election year approaches maturity (historically, in election year index tends to bottom out in Feb/March followed by preelection rally). Thereby, bouts of volatility should not be construed as negative instead adopt buy on dips strategy which has been faring well. In the process, strong support is placed at 21600. Our positive bias is further validated by following observations:

• A)The faster pace of retracement signifies robust price structure as Nifty retraced past seven sessions decline in just four sessions

• B) Heavyweight Banking index (commanding >33% weight) has formed a strong base at 200-day ema

• C) The most of global equity markets are hovering around their 52-week highs, indicating buoyant global cues

• D) steady oil prices and bond yields are likely to act as tailwind

• The strong rebound from key support highlights elevated buying demand that makes us revise support base at 21600 as it is confluence of: A. 80% retracement of current up move off mid Feb low of 21530 is placed at 21667 B. Last week’s low is placed at 21530 C. 50 days EMA is placed around 21500

Nifty Bank: 46384

Technical Outlook

Day that was :

The Nifty Bank continued its winning ways on Tuesday led by buying in private banks . Nifty private banking index gained 1 % leading Nifty bank to close at new one month high at 47094 , up 559 points or 1 . 2 %

Technical Outlook :

• The index started the session on a flat note and then continued to scale higher as it crossed 46500 , led by buying demand in large private banks amid oversold conditions . Price action for the day formed sizeable bull candle indicating continuation of positive momentum with higher high -low formation

• Over past few sessions index has surpassed key hurdles around 46000 mark and now approaching another milestone around 47500 levels . A short term breather would provide an entry opportunity as private banking stocks are now witnessing upward momentum alongwith already strong trends in PSU banks . Buy dips for target of 47500 in coming weeks which is a value of 80 % retracement of 16 -25th jan decline and bearish gap area

• Since index has surpassed key hurdle and withnessing good breadth we are vising short term support to 45800 levels as it is confluence of :

• A) 50 % retracement of past six session rally (44633 - 47136 ) at 45800

• B) rising 100 -day ema (45731 )

• 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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