Dalal Street marched higher on the first trading session of the week. Bulls took control and pulled Sensex 1.7% higher to end at 49,580, while the Nifty closed at 14,923. Indian indices soared with solid gains led by banking, metal and auto stocks due to fall in infection cases. The market expects a rapid fall in daily reported Covid cases which helped to ease concerns over extended lockdowns and sharp correction in FY22 estimates. Banking stocks took a breather as it helped in soothing asset quality concerns.
Nifty closed the day sharply higher with the index rising by close to 1.68% in a day. It was a wide-ranged candle that closed at the top end of the day’s trading range. It is a range expansion candle with its true range highest in the last couple of weeks. Bulls showed massive strength for the day. This pattern appears below the resistance at 15000 -15100 points. Nifty still needs to close above the resistance at 15000 -15100. This is the barrier that has halted many advances the recently in last couple of weeks. MACD signal line has crossed above zero and MACD is in a buy mode and Nifty has again moved above 50 period moving average. The crucial piece of evidence need is a high conviction close above 15000-15100. Once this happens we can brace for a rally to the prior swing high at 15300 -154000. A breakout should signal a sharp rally over the next couple of weeks. If we break 14,700, the markets could fall further to 14400.
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Resistance: 15000, 15100, 15200
Support: 14900, 14800, 14700
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