Indian markets climbed higher for the third consecutive session albeit with marginal gain of 0.47%. The bias remained upwards for the Nifty throughout the session yesterday as it managed to breach previous couple of days’ resistance of 5317 and maintained strength to close above the technical and psychological barrier of 5300. Volumes continue to clock at an average rate and the market breadth was favoring the advances. Upside momentum seems to be losing strength in the short-term as RSI and Stochastic (oscillators) test the overbought territory, warning of profit taking. Since we are in the final session of the week, it is imperative that the bulls maintain strength above 5300 to stamp their authority and also manage a close above 5278 to avoid weekly loss which could trigger a round of correction. Immediate support for Nifty is pegged at 5295/5388 and resistance is at 5342. As per the overall structure, we expect Nifty to test the 20-month trend line target of 5440 before witnessing any meaningful corrective action.
Sectoral indices ended mixed with gains coming from FMCG (+1.03%), Banking (+1.01%) and Cap Goods (+0.87%); whereas profit taking was witnessed in Realty (-0.43%), Metals (-0.39%) and Oil & Gas (-0.14%). Among the broader markets, Mid-cap and Small-cap indices ended the day with gains of 0.90% and 1.64% respectively, outperforming their frontline peer.
Bullish Setups: TATA, GSPL, ICICIBC, PWGR, DLFU, ADE
Bearish Setups: TTMT/A
Regards,
Edelweiss Research
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