INSUBCONTINENT EXCLUSIVE:
The beginning of the week remained disappointing as the technical caught up with the market
The Indian equity market was expected to stall its upmove and in line with the analysis in our previous note, the Nifty corrected in the
The benchmark index ended the day losing 82.05 points or 0.74 per cent.
Relatively much more pain was witnessed in the broader markets as
compared to frontline index
Tuesday is likely to see a muted start and if we anticipate a full throwback of the breakout, the Nifty might still have modest downsides to
We expect the weakness, if any, to persist more because of lack of buying than aggravated selling in the market.
Tuesday is likely to see
the levels of 10,990 and 11,035 to act as immediate resistance area
showing no divergence against the price
The Daily MACD still remains bearish while trading above its signal line
No major formations were observed on Candles.
While having a look at pattern analysis, it appears that post break out above the falling
trend line pattern resistance, the Nifty seems to have temporarily stalled its upmove and it is consolidating on expected lines with the
levels of 10,850 acting as support in case of full throwback occurs.
Overall, we expect a muted trade on Tuesday and some amount of modest
downticks may still be expected if the Nifty moves towards full throwback
We recommend preserving cash and abstain from creating major directional positions
It is important to note that there is no structural breach on the charts and the movement seems to be just a temporary stalling of the
However, liquidity should be maintained to protect positions while maintaining a cautious view on the market.
STOCKS TO WATCH: Shorts were
seen being added in stocks like NCC, GMR Infra, TV18 Broadcast, IDBI Bank, Ashok Leyland, State Bank of India, Adani Power, Tata Global and
ICICI Bank.
(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research Advisory Services, Vadodara
He can be reached at milan.vaishnav@equityresearch.asia)
