Market Commentary

Weekly expiry settles around 11300 amid some profit taking: Angel Broking



Posted On : 2020-08-21 11:34:53( TIMEZONE : IST )

Weekly expiry settles around 11300 amid some profit taking: Angel Broking

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

"Our markets have seen some relentless move in the last few weeks along with global peers. Since globally we witnessed some nervousness today morning, our markets reacted with a gap down opening but fortunately not to the tune of what SGX Nifty was indicating. During the remaining part of the day, Nifty gyrated in a small range of nearly 70 points to eventually settle the weekly expiry tad above the 11300 mark.

Although markets are not willing to correct, we are likely to see some in between reality checks like we saw today and last Friday too. Actually, the index is going nowhere, it's only the broader market that is keeping the traders' fraternity interested since the last few days. We have seen some robust moves in a bundle of mid and small cap stocks, which was clearly missing for more than a year in pre-COVID time. So practically, they are compensating for their long underperformance. Although, there is no sign of weakness yet, we still believe that from here on one should avoid aggressive bets in midcaps. Because we can see a cluster of resistances for NIFTY MIDCAP 50, which includes a '200-SMA' on a weekly chart. Hence, anytime we can see some short-term profit taking in this space. With a broader view, any correction from hereon is considered a healthy one but for momentum traders, it's better not to get caught on the wrong foot.

Now, as far as Nifty is concerned, we observed a 'Bearish Wolfe Wave' pattern on hourly chart on Wednesday and precisely from the Potential Reversal Zone of 11450, Nifty saw some decline. This pattern is still intact and the way charts are shaped up, we continue to remain cautious on benchmark. For the coming session, 11400-11430 is likely to act a resistance; whereas on the lower side, once we slide below 11250-11200, we are likely to see some corrective moves."

Source : Equity Bulls

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