Nifty closed with the smart gains of 57 points :: HDFC Sec

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Current Observation:  Daily timeframe: Nifty witnessed high volatility today, on the day of the presentation of union budget 2015 and finally closed with the smart gains of 57 points.  After opening today with positive note, Nifty showed intraday swing high and low of around 190 levels (8941-8751 levels) on/after the presentation of union budget and it recovered nicely in the end to close in gains.  We observe a formation of high wave type candle today with long lower shadow, which is suggesting a smart recovery from the lower levels. The symmetrical triangle type pattern (green converging trend lines) have been broken on the upside and Nifty closed above it. This could further have positive impact on the market ahead.  The recent bottom reversal formation around 8669 of 26th Feb could be considered as a recent higher bottom of the new positive sequence (sequence of HT & HB) and currently Nifty is moving up to form a new higher top.  The opening upside gap (body gap, not a western gap) of 27th Feb is intact and unchallenged and currently Nifty has placed on the edge of moving above another hurdle of 8915 (previous swing high of 19th Feb).

 Weekly Timeframe: After a sharp bounce back during mid of Feb-15, Nifty shifted into sideways consolidation for the next couple of weeks.  Despite showing sharp weakness during this intraweek, Nifty showed smart recovery but was not able to move above the resistance of around 8915 levels.  The bullish sequence of higher tops and bottoms is intact in Nifty as per larger timeframe and we observe a formations of long lower shadows during intraweek dips. This is indicating an emergence of buying interest from the lows, which displays the strength of bulls to hold on the defense.  If Nifty manages to move above 9000 levels by next week, then that is going to be an upside breakout of the sideways consolidation as per larger timeframe. Such upmove could negate the previous bearish top reversal pattern of shooting star of 30th Jan-15. This expected upside breakout could have a sharp positive impact on the market ahead.  Weekly momentum oscillator like 14 period RSI has turned flat around 65 levels, which is signaling the ongoing sideways consolidation of Nifty. If weekly RSI turns up from the current region, it could mean more upmove for the market, as per the theory of momentum oscillator. Summing Up  The underlying trend of Nifty as per smaller to larger timeframe is positive and further upmove from here could have a sharp positive impact on Nifty for coming weeks. The upside levels to be achieved for next week is at 9100 and immediate support is placed around 8800 levels.

LINK
http://www.hdfcsec.com/Share-Market-Research/Research-Details/StockReports/3011669