INSUBCONTINENT EXCLUSIVE:
In a wide-ranged, but measured session, Indian equity market continued to trade on anticipated lines and ended on a flat note
The market opened on a positive note, but soon pared its gains in the initial trade
However, the late morni ng session saw NSE Nifty getting stronger.
It not only piled on substantial gains, but also tested the upper end of
the consolidation zone, which is marked as a green shaded area on the chart
However, unable to sustain at those levels, the headline index pared its gains entirely and ended the day flat with negligible gain of 18
points or 0.16 per cent.
Although the market faced expiry of the weekly options, the volatility cooled down as India Vix came off by 4.04
per cent to the 23.25 level
Also, Nifty respected all its technical levels while resisting precisely at the upper end of the consolidation zone
Going ahead, for any sustainable upmove to happen, Nifty will have to move past 11,400 and attempt to fill the gap that exists above that
zone.
Friday’s session is likely to see a stable start to the day
The 11,310 and 11,365 levels will act as resistance
The support may come in at 11,190 and 11,110.
The Relative Strength Index (RSI) on the daily chart was at 31.56 and stayed neutral, showing
no divergence against the price
The daily MACD was bearish and traded below its signal line
A black body was formed on the candles.
As per pattern analysis of the daily chart, Nifty has attempted to find a temporary base near the
11,050-11,100 zone, which also acts as a double bottom pattern support for the index
Apart from this, it appears to be consolidating in a broad range with 11,050-11,100 levels acting as crucial support for the near term.
The
11,400 level now becomes a vital zone to watch over the coming sessions
No sustainable upmove shall occur unless Nifty moves past this and attempts to fill up the gap that exists above 11,400
Until then, we will continue to see the market staying vulnerable to selling pressure at higher levels.
In the immediate short term, we
expect the consolidation to continue within the defined range
We would recommend traders to stay extremely stock-specific and continue to protect profits at every stage, while keeping exposures at
modest levels.
(Milan Vaishnav, CMT, MSTA, is a Consulting Technical Analyst and founder of Gemstone Equity Research - Advisory Services,
He can be reached at milan.vaishnav@equityresearch.asia)
