INSUBCONTINENT EXCLUSIVE:
In our previous weekly note, we had mentioned that the Nifty would continue to mark new highs gradually, but a meaningful rise will continue
Much on the expected lines, the week that went by saw the market refuse to correct and end the week with modest gains.
While the market
remained highly overextended on the weekly charts, the Nifty50 marked intermittent highs and ended the week with net gains of 123.40 points,
or 1.07 per cent.
The post-market hours on Friday saw a strong GDP data come in
This being an important macro-economic input, it is expected to give some fillip to the market when it reopens for trade on Monday
At the same time, there are greater chances that after an initial reaction to good economic data, the overbought and overextended technical
charts may weigh on the market.
The coming week is likely to see the 11,760 and 11,855 levels act as immediate resistance for Nifty
Supports should come in at 11,590 and 11,480 levels
The RSI has marked a fresh 14-period high, but remains in the overbought territory
No divergence was observed against the price.
The weekly MACD continues to remain bullish as it trades above its signal line
Apart from a white body that emerged on the candles, no significant formations were observed on charts.
The prices have closed above the
upper Bollinger band and this may mean the upward move may continue
Given the overbought condition of the market, there are greater chances that we may see some pullback inside the band.
We continue to
recommend staying away from making aggressive purchases and continue to use the uptrend, if any, to book profits and protect existing
Despite the primary uptrend remaining thoroughly intact, the market remains overbought and over-extended and, therefore, a few corrective
moves at higher levels cannot be ruled out.
Volatility may return once again
We recommend a highly cautious approach in the coming week.
In the coming week, we are likely to see resilient performance from Nifty
MidCap, Nifty MID50, Nifty NEXT50, as they continue to show an improvement on relative momentum
Despite some slowdown in momentum, pharma and energy packs remain in the leading quadrant and may continue to relatively outperform the
broader market along with the FMCG pack
CNX auto is losing momentum and continues dismal performance
Financial Services and BankNIFTY are also losing momentum, as they remain in the weakening quadrant
We might also see some improvement in infra and metals packs
No major performance was expected from the consumption, media and realty stocks.
Important Note: The RRGTM charts show you the relative
strength and momentum for a group o 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.
