Some indecision or a profit booking, still no reason to worry for: Angel Broking

Daily Market Wrap Up by Mr. Sameet Chavan (Chief Analyst-Technical and Derivatives, Angel Broking):

"Today morning, the global cues were excellent and the set up was just ideal to have a good head-start for the day. In-line with this, the Nifty opened higher by nearly half a percent and within first 10 minutes of trade, 11900 was on the screen. After this, we had a gradual up move for the major part of the day. However, precisely at the stroke of the penultimate hour, market started giving up its gains rapidly and eventually we pared down decent portion of it to conclude the October series tad below the 11900 mark.

The tail end correction was mainly due to some announcement from China with respect to recent trade war talks. On the domestic front, it coincided with the October month derivative expiry and eventually, spoiled the party for those who took a punt for it to pan out beyond 11900. Nonetheless, the expiry was spectacular for the bulls, especially the latter half; because the overall market breadth improved tremendously in this period. Now, if we look at the daily chart, the daily candle indicates some indecision as it resembles a 'Spinning Top'. Here, we interpret this as an indecision or a profit booking after recent relentless rally; but certainly does not construe this as a sign of caution. In our sense, the northward trajectory is likely to continue and soon we are likely to be heading towards the 'Budget Day' high of 11981.75. In fact, the rally can get extended beyond 12000 as well.

For the coming session, today's low of 11855 would be seen as a crucial support and in case of breaching this convincingly, we may see further profit booking towards 11885 - 11776. In such scenario, this decline will provide excellent opportunity for traders to go long around mentioned support levels with a positional perspective. Meanwhile, avoid aggressive trades and keep focusing on individual stocks for better trading opportunity."

Source : Equity Bulls

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