INSUBCONTINENT EXCLUSIVE:
Friday session on Dalal Street went off much on the expected lines
The markets saw a steady start and after remaining rangebound in the morning session, it reacted in an extremely volatile manner to the
At one point, Nifty came off nearly 150 points after a sharp rise only to recover again
After such wild swings back and forth, the benchmark index ended the day 62.70 points, or 0.58 per cent, higher.
In one of our previous
notes, we had mentioned that despite any volatility or upward moves that the market may witness, it will continue to be broadly guided by
Going by Friday’s trade, even with the strongest of the initial moves, the index halted the moment it went beyond the all-important 10,950
mark, which is acting as a resistance for many weeks now.
To put this in perspective, unless Nifty moves past this level, sustainable upward
moves would be difficult to come by
Monday’s session might see a flat to modestly positive start
The Interim Budget is likely to be taken positively and as one of the balanced ones, and we might see Nifty attempt to inch higher once
The index is now trading above its key moving averages.
Going forward, we expect the market to face resistance at 10,950 and 11,085 levels
Supports come in at 10,840 and 10,760 levels
The Relative Strength Index (RSI) on the daily chart stands at 55.8109
It remains neutral and shows no divergence against price
The daily MACD remains bearish as it trades below the signal line
A white body has emerged on the candles
Apart from this, no significant formations were observed.
Through pattern analysis of the daily charts, it was observed that despite the
failure of the ascending triangle formation, Nifty continues to be in a broad range
Also, along with this, the index remains trapped in a range with the 10,950 level acting as a major resistance for the immediate short
term.
Overall, Nifty is expected to remain in a broad range and trade with a positive bias
It is also expected to make attempts to inch higher towards 10,950 level and move past it
On the other hand, the 10,740-10,840 zone remains an important support zone, as all key moving averages fall in this area
We recommend avoiding shorts
Keep making stock-specific purchases as long as the indices remain above their critical supports
A cautiously positive outlook is advised for the day.
(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research
Advisory Services, Vadodara
He can be reached at milan.vaishnav@equityresearch.asia)
