Bears stunned by astonishing recovery, next level to watch at 9000: Angel Broking

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

"It was a long weekend for our market but it turned out well as we saw a good bump up of more than 200 points at the opening for our markets. This was on the back of a colossal overnight rally in US and other global markets as the death toll with respect to coronavirus reduced a bit and thereby gives early sign of subsiding this pandemic. After a gap up opening in our markets, the rally kept extending throughout the day to post huge rally of nearly 9% to kickstart the new trading week.

As far as the coronavirus pandemic is concerned, in reality, we are still not out of the woods yet. But market mostly moves on hope or anticipation, this is clearly one of those instances. Technically, the major impact of this epidemic has already been discounted by markets across the globe in last few weeks, there was just a small ray of hope needed to rebound sharply from extreme oversold or under owned situations. With this, Friday's decline becomes a bear trap as we are significantly off lows now before anyone could realise. The Nifty is now most likely to head towards '20-day EMA' level of 9000-9050 and the next path of action would be decided how the bulls tackles this resistance. Looking at today's sharp broad based move, we will not be surprised to see Nifty surpassing it and then marching towards 9200 - 9400 levels. On the flipside, 8550-8360 now becomes a sacrosanct support for a while.

Since it was a broad based rally today, almost all pockets managed to rebound sharply, especially recent beaten down spaces like private banks and Auto counters. However, the stage was set by the pharma counters on Friday who continued their remarkable run today to clock another 8-10% upmove. Traders are advised to capitalise on such rebounds and look to book timely profits for a while."

Source : Equity Bulls

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