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An unexpected bullish day in Dalal Street where short covering+value buying reigned supreme. With the exception of IT, all other industry indices ended in the green, with the auto and FMCG indices posting the largest gains. Markets got off to a strong start to the week, up nearly a percent after taking a breather from the recent slide. After the flat open, the Nifty index gradually rose thanks to a rebound in select index majors across sectors. At the close, the Sensex was up 468 points to 61806 and the Nifty was up 151 points to 18420. After a minor dip over the past week, the Nifty reached the intersection of the 40 DEMA and the daily lower Bollinger Band. These two parameters together form an important support zone and the same can be observed this time as well. The channel study also shows that the index touched the bottom of the down-sloping channel that encompasses the recent decline from 18900. Of these several technical parameters, the Nifty took a leap on December 19th. Going forward, the Nifty is expected to test the upper channel line near 18650. On the downside, 18300-18200 will act as a key short-term support zone. A decisive close above 18,500 on Nifty could further fuel the recovery otherwise profit taking could resume. Bank Nifty bulls managed to hold down the 43k support and the index saw buying momentum throughout the day. The index is stuck in a broad range between 43k and 44k and a break on either side will cause a trend move. The undertone within the range remains bullish and one should maintain a buy-on-dip approach around the mentioned support level. All eyes will be on the RBI MPC meeting minutes to be leaked on Wednesday 21st December. The Strait will be looking for clues to the RBI's inflation scenario and action plan in the coming months. Technically, the biggest hurdle for Nifty is only seen at 18900.
Resistance: 17350, 17450, 17550
Support: 17250, 17150, 17050
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