Some fatigue at 11500, banking holds firm: Angel Broking

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

"Global markets are clearly enjoying their dream run and the winning streak continued last night as well as today morning. As a result, despite SGX Nifty indicating a sluggish start, our markets opened higher above the 11500 mark. However, Nifty failed to extend the optimism as we saw couple of sharp swings of profit booking from day's high. Fortunately, we managed to defend key levels and with the help of a gradual recovery towards the fag end, the Nifty ended session with negligible gains.

Although we have been sounding a bit cautious since last a week or so, market didn't look tired at any point; but today for the first day, we witnessed some fatigue in Nifty at higher levels. Technically speaking, we observed a 'Bearish Wolfe Wave' on hourly chart and precisely from the Potential Reversal Zone of this pattern, we witnessed some profit booking in the market. Till now, we were only making our assumptions but now we can see a defined level on chart, which can trigger some weakness in Nifty. This level is at 11420, which is today's low as well. Going ahead, a sustainable move below this point should be considered as an exit opportunity for existing longs and aggressive traders can opt to short as well. Below this, 11350-11300 are the next levels to watch out for. On the upside, 11500-11525 remains to be an immediate hurdle and in case if it extends further, we will still avoid participating in it.

The banking space has gained some strength in last 3-4 days and it is clearly not letting the market fall. Today too, it managed to hold strong and has now reached it's recent crucial high around 23200-23250. Now going ahead, it would be interesting to see whether BankNifty still holds Nifty higher or a failure to surpass 23250 triggers some correction. Apart from this, some profit taking was seen in the broader market and hence, one needs to be watchful there as well."

Source : Equity Bulls

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