Markets started the week on a positive note, continuing last week's trend, and ended with gains of almost a percent. Supportive global cues, as well as healthy buying across sectors, saw the benchmark gradually rise throughout the day. The Nifty ended with strong gains of 17,340 levels, up 1.06%. Strong global cues and upbeat vehicle sales numbers from select front-line automakers fueled another round of rallies in domestic stocks. The hangover from the US interest rate decision is now behind us and the focus is now on the RBI policy meeting later this week, where traders are anticipating the rate hike may come in line with expectations. Indian equity benchmark indices closed higher for the fourth consecutive day on August 1, with Nifty closing above 17,300 on the first day of the new series. To finish, the Sensex was up 545 points, to 58115 and the Nifty was up 181 points to 17350. . the return of FII inflows into local equity markets has also brought back some cheer among investors. Currently, the Nifty is trading comfortably above the 200-day SMA and is still holding higher highs and higher lows on intraday charts. However, with the market temporarily in an overbought state, we could see a quick intraday correction in the near term. For traders, 17,250 would act as a key support level, above which the index could rally towards 17,450-17,500. On the upside, a quick intraday correction below 17250 is possible, below which the index would retest the 17150-17100 level. The Nifty continued its winning streak from last week. Although the hourly momentum indicator has developed negative divergence, the price action itself remains resilient. On July 29th, the Nifty had risen above the 61.8% retracement of the April-June decline and the 200 DMA. It is now trading near the 61.8% retracement of the entire Oct. 21-June 22 decline, i.e. 17150 with reversal of bullish stance at 17000. The uptrend in the market continues as the bull invasion continues in the 17200-17500 zone. The trend is likely to remain positive as long as the reference index holds above 200 DMA and is placed at 17000. This week markets will continue to be guided by ongoing gains as well as global peers. Also, RBI's monetary policy outcome scheduled for August 5 will be crucial for market participants. We would advise investors to focus on maintaining a stock-specific approach. 17200 should act as crucial support in the near term; while on the upper end 17500 can act as a crucial resistance. Above 17500, the Nifty could rally back towards 17800-18000
Resistance: 17400, 17600, 17800
Support: 17200, 17000, 16800
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