Nifty reclaims 9900 with some authority: Angel Broking

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

"This week we started proceedings with a good bump up on Monday, owing to favorable global cues. However, this ecstasy was short lived as we witnessed a gradual profit booking thereafter. Until Thursday's first half, index kept gyrating in a very slender range but post the deferment of Supreme Court's verdict with respect to AGR dues, markets joined hands with global peers. And since they were trading deeply in red, the Nifty breached the support of 10000. In fact, things worsened when US markets plunged more than 5% on Thursday. This resulted in a massive gap down opening in our markets on Friday. Fortunately, our markets saw a v-shaped recovery throughout the remaining part to conclude the day marginally in the green and thereby restricting weekly losses to a couple of percent.

Barring last two sessions, our market was undergoing a consolidation phase, but the range widened a bit towards the fag end. Broadly speaking, in the midst of all this, our markets retraced recently up move and managed to reclaim the crucial support of 9900 in a matter of a few trading hours. If you refer to our recent articles, for us, the trend changing level was 9900 and although it was breached intraday, we will give more weightage for closing levels. Nifty has not only reclaimed it on a daily basis but with Friday's close, it has been defended on a weekly basis as well. Hence, we continue to remain upbeat and construe this decline as a retracement of the recent up move, which was very much needed to provide the strength for the next leg of the rally. As far as supports are concerned, 9900 continue to be seen as key support on closing basis. But with today's move, we can mention a slightly bigger support zone of 9900 - 9544 for the coming week.

On the flipside, we expect Nifty to again go back to recent highs of 10150 - 10300 or may even head towards 10600 - 10800 levels. One of the key rationales behind this hypothesis is the overall positioning of the Bank Nifty. Couple of weeks back, we could see confirmation of a positive crossover in 'RSI-Smoothened' on the weekly chart. Historically it's proven that when this kind of crossover happens in this oscillator, it has the tendency to give bigger moves and hence, this observation is adding conviction to our optimistic stance. Also, it would be unfair not to throw some light on the 'Midcap' index, which has given a remarkable move on Friday and thereby indicates a strong move in the offing."

Source : Equity Bulls

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