Nifty outperforms global peers, real action in broader market: Angel Broking

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

"Today, despite SGX Nifty indicating a gap down opening of more than 50 points, our markets kicked off the session higher and then registered a fresh record high. We clearly shrugged off negative cues from the global bourses throughout the session and kept marching higher gradually to end the session convincingly above 12300, which again is a new milestone for our markets.

The way the market is ignoring any unfavorable news flow and just focusing on positives, is a perfect characteristic of a 'Bull Market'. But at the same time, as a trader, such euphoric situation is difficult to ride after one point, because sooner or later, one surprising down move (especially overnight) can catch you on the wrong foot. So to be on the safer side, we have been advocating staying light and keep booking profit in this rally since the last 3 - 4 days. Market always tests patience in extreme scenarios, be it in the panic or euphoric moves. The ideal strategy in such an environment is to stick to a stock centric approach with a proper risk management and avoid aggressive bets overnight.

As far as levels are concerned, 13400 - 13500 are the immediate levels in the upward direction; whereas on the lower side, 13292 - 13242 should be seen as key supports. Any decisive move below 13242 would result in an extended profit booking in the market. At present, midcaps are enjoying their merry days and hence, breakout candidates are fetching handsome returns. But from here on, one should reduce the position size in midcaps too and should follow strict stop losses, because any day when profit booking aggravates, breakout failure is imminent."

Source : Equity Bulls

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