INSUBCONTINENT EXCLUSIVE:
Indian stocks saw their first corrective move on Friday, as the market breadth worsened
The NSE benchmark Nifty ended with a loss of 41.20 points or 0.36 per cent
After opening flat, and trading very briefly with gains, the market slipped and remained under corrective pressure for the rest of the day
The Nifty may open on a flat to mildly negative note and look for directions
There are mild chances that we might see the corrective phases continue, but the session is broadly likely to remain a rangebound one.
The
Supports may come in at 11,375 and 11,310 zones.
The Relative Strength Index (RSI) on the daily chart is 69.9607
It has just slipped below 70 from a topping formation and this is a bearish sign
It remains neutral and shows no divergence against the price.
Monday is likely to see the levels of 11,485 and 11,520 acting as likely
resistance area.Though daily MACD has flattened its trajectory, it continues to remain bullish while trading above its signal line.
If we
study pattern analysis, Nifty has shown first mild signs for temporary exhaustion of upmove post breaking out from 11,170-11175 levels
This may translate into the Nifty slipping into rangebound consolidation.
In event of any consolidation or minor corrective moves happening,
we are expected to see limited downsides
In any case, the place from where the NIFTY broke out, i.e
11,170-11,200 zones will continue to act as sacrosanct supports for the immediate short term.
On the upper side, until the levels of
11,495-11,500 will continue to pose resistance.
We expect the market to consolidate in this broad range for some time while it gathers
strength for a fresh directional move.
Remaining highly stock-specific, protecting profits at higher levels and keeping overall exposures
modest is what is recommended for the day.
STOCKS TO WATCH: Long positions were seen being added in stocks like ITC, HPCL, Berger Paints,
IDFC, Excide Industries, Voltas, Infosys, NHPC, YES Bank, PVR, Balkrishna Industries and Kotak Mahindra 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)
