INSUBCONTINENT EXCLUSIVE:
The markets opened lower and after testing lows of the day by afternoon, the benchmark Nifty50 saw remarkable recovery in the second half of
The benchmark index recouped nearly all of its losses and ended the day flat losing just 0.70 points or 0.01 per cent.
The session saw some
good amount of shorts also being added as the Nifty June futures saw discount widening further by 26-odd points
We expect a modestly positive opening to the trade but in the same breath, also expect some resistance coming in the 10,820-10,850 zones
which is likely to prevent any immediate runaway up move in the Nifty.
As we step into the fresh week, Monday will see the levels of 10,820
and 10,850 acting as important resistance area for the Nifty
Supports will come in at 10,710 and 10,630 zones
Daily MACD has turned bullish and it currently trades above its signal line
Apart from a white body, no significant formations were observed on Candles.
If we look at pattern analysis, we see that a fresh trend line
resistance is being developed on the Daily Charts
This line marks the highest point of Nifty at 11,171 and then subsequently joins two other lower tops
In the immediate short term, the zone of 10,820-10,850 works out as the pattern area resistance given this formation.
Overall, though there
are no triggers for any outright negativity in the markets
The global scenario remains stable and we may see Nifty advancing its gains
However, it would become imperative to become cautious near the 10,820-10,850 zones as Nifty may again develop some formidable resistance in
Only a meaningful breach of the 10,820-10,850 zones on the upside would mean resumption of upmove for Nifty.
Unless this happens, Nifty will
remain susceptible to corrective actions from higher levels
While maintaining highly stock and sector specific view on the markets, fresh purchases may be made while guarding profits at higher
levels.
STOCKS TO WATCH: Long positions were seen being added in JP Associates, SAIL, Bank of Baroda, CG Power, PNB, Reliance Suzlon, Sun
Pharma, State Bank of India, Tata Motors, TV18 Broadcast and Indraprastha Gas.
(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at
Gemstone Equity Research Advisory Services, Vadodara
He can be reached at milan.vaishnav@equityresearch.asia)
