Technical & Derivatives Report
Quite similar to Friday's session, the bank nifty started with a gap
up opening however it lacked follow-up buying and slipped lower
to mark an intraday low of 31837. Subsequently, it managed to
bounce back a little in the second half to eventually end with a loss
of 0.27% tad below 32000 levels.
Yesterday, the bank nifty underperformed as compared to
benchmark index Nifty that added another percent to its current
relentless run. For the last few sessions, we have witnessed a
sluggish move in the bank index as it has reached the vicinity of
the all-time high. Going ahead as long we don't see a broad-based
buying; the bank index may continue to struggle around the last
two sessions high of 32300 and at the all-time high level of 32613.
On the flip side, 31700 and 31530 is the immediate support.
Stock-specific opportunities are seen on both sides of the trend
and traders are advised to follow the same with proper trade
Support 1 – 31700 Resistance 1 – 32300
Support 2 – 31530 Resistance 2 – 32613
Exhibit 1: Nifty Daily Chart
Second week of the new calendar year started with a good bump up
at fresh record high tad below the 14500 mark. In the initial hour,
we witnessed a small bout of correction; but similar to recent trend,
the intraday decline was bought into and the index thereafter once
again resumed its upward trajectory. The opening was mainly led by
the IT stocks after a good set of numbers from IT giant TCS over the
weekend and then few Auto heavyweights took it from there to add
another percent to the Bulls’ kitty.
The gravity defying move continues and although, it has turned into
a bit of euphoria, markets are not willing to give any correction at all.
Only god knows when it’s going to happen, but till then it’s better to
participate through stock centric approach by following a money as
well as risk management. As a technician, it’s becoming tougher day
by day to project upward levels as we are located in an uncharted
territory. Beyond 14500, next psychological level would come
around 14600 and on the flipside, 14350 – 14300 becomes the
immediate support. We reiterate that even if one remains with the
flow, avoid becoming complacent and too aggressive. Hence, as a
short term trader, it’s advisable not to create leveraged positions.
Support 1 – 14350 Resistance 1 – 14550
Support 2 – 14300 Resistance2 – 14600
As mentioned in the earlier section, yesterday’s move was mainly
propelled by the IT and Auto stocks; whereas banking remained
slightly on the back foot. Traders should look to identify such
appropriate themes and we reiterate that it’s better to keep booking
profits in the ongoing rally, because every now and then, we are
likely to see stock specific correction in the market.
Exhibit 2: Nifty Bank Daily Chart