Dear
Trader…
The BSE Sensex traded a new high of 52235 points and the Nifty
futures hit a record high of 15357points today as equities witnessed high volatility and the bulls have ruled positive market with strong global cues.
IT, metal, auto outshone while FMCG,
pharma took a breather over the week. The Nifty took a breather amid positive
bias, after last week’s sharp up move, as it formed a small bull candle
carrying a higher high-low formation. In the process, broader markets outperformed
on expected lines.
The weekly price action resulted in a
High wave candle indicating a healthy breather after post budget rally
measuring more than 23 % rally in just seven sessions the daily stochastic had
approached to overbought trajectory which has resulted in a sideways
consolidation in the last four sessions . With this backdrop, current breather
should not be seen as negative instead one should adopt buy on decline strategy
as the overall structure remain firmly positive.
We observed profit booking in
individual stocks, the profit booking trend was seen in so many sectors, which
weighed down heavily on the market and thus market had a decent decline during
the trading. But similar to recent bullish trend once again played out well in
the market, which helped the market erase its losses completely.
Market maintained
their upward momentum after growth oriented budget, this raises the possibility of a
bullish technical count, especially if it does not correct sharply on the
succeeding day.
Technically, the recent
consolidation in the index is in line with expectations and the market is
expected to continue on bullish momentum based on current price action, once
the same break above the current key resistance holding near 15272 levels. The
upside rally could be testing all the way up to whole new levels in the
upcoming sessions. Alternatively, if the market struggles to break the
resistance, then it might retest the same and revise the trend to bearish mode
once again. Key support holds near 15202. A slide to 15133-15088 levels is also a
possibility if the price makes or break below the current support level.
We expect some correction after each rally. We advise investors to use correction in the market as an opportunity to buy, on the other hand, traders should maintain extra caution due to the expected rise in volatility ahead.
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