By Sameet Chavan
The global markets did extremely well last night and early this morning as well. As a result, our markets started the day with a strong bump up almost at the 17200 mark. However, without wasting much of a time, NSE Nifty 50 came back to its equilibrium to match with what SGX Nifty was indicating. The Nifty almost corrected nearly 100 points from opening high and almost tested 17050. The mighty bulls pounced on this opportunity and grabbed it with both hands. Markets took a U-turn thereafter and with the help of a broad-based buying in the latter half, Nifty hastened towards 17300. Eventually, with some expiry adjustments, Nifty ended the April series on a promising note around the 17250 mark.
In the last week and a half, our markets have shown some resilience in comparison with most of the global peers. This is an indication of the inherent strength and hence, the moment we see some relief globally, our markets would be the first one to take a leap. We continue to remain hopeful as long as 16900 – 16800 are defended successfully. Now with the last two weeks of range bound movement, the daily time frame chart exhibits a ‘Triangle’ pattern and prices are inching closer to its apex point. Hence, the breakout in either direction is imminent.
As of now, we expect it to happen in the northward direction where 17400 – 17450 are the levels to watch out for. The moment we surpass this, we could see a lot of individual stocks participating in the next leg of the rally. For Bank Nifty, the levels to watch out for would be 36700 – 37000 on the higher side and the sacrosanct support zone is placed at 36000 – 35500.
During the series, we observed some short formation, but it seems most of them are out of the system now. Rollover in Nifty and Bank Nifty stood at 78% and 85% respectively, which is on the lower side if compared with three-month average. Stronger hands added bearish bets throughout the series and have rolled over these positions. Their ‘Long Short Ratio’ is at 35%, which clearly hints they are oversold now. Going ahead, it would be very interesting to see their action, any covering shall be a very encouraging sign.
Most of the key indices are placed at a crucial juncture and they are waiting for some trigger to make a move. We hope to witness a much-awaited breakout in the early part of May series which will certainly bring back the wider smile in traders’ fraternity.
(Sameet Chavan is a Chief Analyst-Technical and Derivatives at Angel One. Views expressed are the author’s own. Please consult your financial advisor before investing.)
from | The Financial Express https://ift.tt/xhmv8Qf
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