INSUBCONTINENT EXCLUSIVE:
In our previous note, we had talked about some likely respite from the weakness that the market was experiencing, and projected a possible
Nifty respected the pattern support at the 50-DMA and after remaining rangebound in the first half of the session, it posted a smart rally
The index ended the day gaining 92.55 points or 0.87 per cent.
Purely on technical terms, since the market has ended at the high point of
However, we expect a shaky start to trade on Monday, as investors would be reacting to exit poll outcome and try to build in the election
The election outcome is going to be a volatile affair to handle, as the results will be scrutinised keeping the 2019 general elections in
view.
In the event of a shaky start, the 50-DMA which is now at 10,567 followed by 10,510 is expected to lend support to Nifty
Resistance, on the higher side, is expected to come in at 10,740 and 10,770 levels.
The Relative Strength Index or RSI on the daily chart
It remains neutral and shows no divergence against the price
The daily MACD is bullish and trades above its signal line
A white body occurred on the candles
Apart from this, no significant formations were observed.
Pattern analysis shows the Nifty has halted at its short-term 20-DMA and going
There are a significant amount of shorts in the system
This means any downside jerks will also see buying
We, however, recommend guarding profits vigilantly at higher levels until the 200-DMA is breached on the upside
On the lower side, investors should avoid shorts, but can continue defensive purchases on a selective basis
A cautious outlook is advised for the day.
(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research Advisory
He can be reached at milan.vaishnav@equityresearch.asia)
