INSUBCONTINENT EXCLUSIVE:
The stock market on Friday ended on a positive note with the NSE benchmark Nifty gaining 53.10 points or 0.48 per cent
The stocks remained flat on a weekly basis, and the Nifty remained within a congestion zone, which it created after breaking out above the
falling trend line pattern resistance area
Broader markets too remained positive.
As we approach the fresh week, we expect a positive start to the trade
The no-confidence motion going in favour of ruling BJP government will remove volatility to some extend and give some positive fillip to the
However, we expect the market to remain under positive consolidation for some time before it resumes the upmove and retest previous
highs.
Monday is likely to see the levels of 11,065 and 11,150 working out as immediate resistance area for the Nifty
Supports are expected to come in at 11,950 and 11,910 zones.
The Relative Strength Index (RSI) on the daily chart stood at 61.7819, and it
continues to remain neutral showing no divergence to the price
The daily MACD stays bullish while trading above its signal line
No significant formations were observed on the candles.
If we have a look at the pattern analysis, it is evident that the Nifty broke out
above the falling trend line pattern resistance
After the breakout the Nifty is currently seen taking a breather and is again consolidating in a capped range
Such formations act as continuation patterns in most cases.
Overall, we recommend continuing to approach the market with a positive bias
Consolidation after an upmove is a sign of strength and as of now Nifty has shown no signs of any impending major downside turns.
The
present structure of the market is more likely to favour the buy-on-declines approach than sell-on-rally strategy
High specific and stock specific purchases may be made at every opportunity while continuing to vigilantly protect profits at every up
move.
Stocks to watch: Technically resilient setup was observed in stocks of Glaxo Consumer, Relaxo, Berger Paints, Bharat Electronics,
Bajaj Finance, Infosys, JSW Steel, Indiabulls Real Estate, Motherson Sumi and RBL 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)
