By Ajit Mishra
Markets have resumed the corrective phase after a pause for a week. The tone was largely in line with the global peers and almost all the sectors, barring the defensive viz. FMCG and pharma, traded under pressure. The trend was mixed on the broader front wherein the midcap ended flat but the smallcap lost over half a percent.
Nifty (CMP: 18,101.20)
Nifty has been finding support around the 17,800 zone for the last three weeks and its decisive break would add to the pressure. The next crucial would come closer to the upper band of the broadening formation which currently lies around 17,450 levels and it also coincides with the support zone of the major moving average i.e. 200 EMA on the daily chart. In case of a rebound, it would face pressure around the 18,300-18,500 zone.
Bank Nifty (CMP: 42,582.75)
After the initial outperformance, the banking index is also now trading in line with the Nifty and witnessing pressure. It has slipped below the support zone of short term moving averages viz. 20 EMA and 50 EMA on the daily chart. Going ahead, the decline below the previous swing low i.e. around the 41,500 zone would further add to the pressure and it may next find support around 41,000 levels. On the higher side, the 42,900-43,600 zone would act as a strong hurdle.
Stocks to Watch
Bullish – Bharat Forge, Bharti Airtel, Gail, M&M, Manappuram, and PetronetBearish – Berger Paint, LTIM, Naukri (Info Edge), and Zee Ltd
(Ajit Mishra, VP- Technical Research, Religare Broking. Views are author’s own.)