INSUBCONTINENT EXCLUSIVE:
a capped and narrow range
under modest pressure, but the downsides are likely to remain limited.
On the upper side, the struggle with the levels of 10,820-10,850 is
Tuesday will continue to see the levels of 10,850 and 10,895 acting as important resistance area
Supports will come in at 10,765 and 10,710 zones.
The Relative Strength Index (RSI) on the daily chart is 57.7446
RSI continues to remain neutral, showing no divergence to the price
The daily MACD stays bullish while trading above its signal line
A small black body occurred on the candles and in the present context it holds no significance.
The pattern analysis shows that Nifty
continued to resist to the falling trend line resistance area of 10,820-10,850 zones
Breach on the upside of these levels is necessary for any meaningful upmove to occur
Overall, while Nifty continues to resist to the falling trend line that joined the high of 11,170 to the subsequent lower tops, it also
continued to show some inherent strength by consolidating around the resistance area without showing any major declines.
The present amount
of shorts in the system is likely to keep the overall downsides limited
However, in the same breath, unless the index moves past the 10,820-10,850 zone and sustain above that, it will remain vulnerable to
pressure from higher levels and prolonged consolidation.
We recommend remaining modest on exposures, preserving cash and making select
purchases with each available opportunity.
STOCKS TO WATCH: Long positions were being added in Idea, Equitas, SAIL, Adani Enterprises, Power
Grid, BHEL, Bata India, Tata Motors, NBCC, Ujjivan, ICICI Bank, TVS Motors, Exide and Asian Paints.
(Milan Vaishnav, CMT, MSTA is Consultant
Technical Analyst at Gemstone Equity Research Advisory Services, Vadodara
He can be reached at milan.vaishnav@equityresearch.asia)
