INSUBCONTINENT EXCLUSIVE:
In our previous Weekly Outlook, we had expected high probabilities of the Nifty continuing to consolidate despite an attempt to break out on
Much on the expected and analysed lines, the Nifty headed nowhere although it continued to remain extremely volatile all through the week
The benchmark index ended the week flat, losing just 8.70 points, or 0.08 per cent, on a week-on-week basis.
The coming week is likely to be
We are expected to see a positive start to the trade on Monday following a favourable ending to the no-confidence motion against the
On the other hand, we have expiry coming up next week, which is likely to keep the trade volatile and dominated with rollovers.
The coming
week is likely to see the levels of 11,170 and 11,265 if the immediate previous high is taken out
The supports come in at 10,910 and 10,835 zones
The range for the coming week is likely to remain wider than normal if at all the Nifty attempts to take a meaningful directional call.
The
Weekly RSI stands at 64.2809
It remains neutral and shows no divergence against the price
The Weekly MACD stays bullish while it trades above its signal line
A spinning top emerged on Candles.
Such candle often reflects indecisiveness of market participants.
In the previous week, the markets were
expected to consolidate, given the slightly overstretched structure of the Daily Charts
This may happen in the coming week as well
However, the undercurrent remains buoyant and the fading away of the political uncertainty is likely to give a positive fillip to the
The current environment of the markets favours buying on dips rather than selling on rallies
Given this cautiously positive outlook, one may continue making select purchases while still protecting profits at higher levels.
A study of
Relative Rotation Graphs shows that an interesting picture has emerged
The sectors like BankNifty, Financial Services and FMCG currently in leading quadrant may continue to show relative outperformance
However, they are seen losing momentum and this may hamper their overall performance
Stock-specific outperformance is very much likely in these packs though.
PSU Banks are expected to put up a steady show
Pharma is seen improving its relative momentum
Sharp improvement in relative momentum is also observed in the energy pack
Small Caps, PSE and realty continue to weaken, and no major performance may be expected from them
The interesting and rather favorable picture that emerges is that of the broader markets
Broader market indices like CNX100, 200 and 500, along with Nifty Midcap and Junior pack, continue to remain in the weakening quadrant
They have clearly flattened their trajectory
We may expect some stalling of the persisting downtrend and subsequent consolidation in these packs leading to improvement over coming
weeks.
Important Note: RRGTM charts show you the relative strength and momentum for a group of stocks
In the above Chart, they show relative performance as against the Nifty index and should not be used directly as buy or sell signals.
