INSUBCONTINENT EXCLUSIVE:
After opening flat and trading lacklustre in the first half of the trade, the market again turned negative and slipped to close at yet
another day with losses.
The pain was witnessed more in the broader market, as this was evident in the market breadth, which remained much
weaker in the favour of the declines
Except for the IT pack, all the sector indices ended in the red
prices along with weak global cues are likely to act in tandem with weak technical indicators.
We expect a modest opening to the trade, and
some mild corrective undertone may continue to persist
Though downsides, if any, may not be severe, but broader market may continue to underperform.
The levels of 11,565 and 11,620 will act as
technical resistance area on Wednesday
Supports may come in at 11,480 and 11,410 zones.
The Relative Strength Index (RSI) on the daily chart is 54.9449 and it has marked yet
another 14-period low, which is bearish
A bearish divergence was also observed, as while RSI marked a fresh 14-period low, the Nifty did not
The daily MACD stayed bearish while trading below its signal line.
Overall, we may expect the market to make few attempts to gain stability
The Nifty has ended near its short term 20-DMA and it would be crucial to see if it manages to take support and continues to remain in a
defined range.
No runaway upmove is expected in any sector, though, we will continue to see defensive stocks relatively outperforming the
It is important to note that there is no structural breach on the charts and the primary uptrend remains intact
We recommend not to take any aggressive short positions and continue making smart purchases
Cautiously positive approach is advised for the day.
STOCKS TO WATCH: Long positions are seen being added in stocks like Axis Bank,
Mindtree, Bajaj Finance, Apollo Hospitals, Wipro, Sun Pharma, TCS, Reliance and Tata Elxsi.
(Milan Vaishnav, CMT, MSTA is Consultant
Technical Analyst at Gemstone Equity Research Advisory Services, Vadodara
He can be reached at milan.vaishnav@equityresearch.asia)
