Market Outlook: Benchmark indices trapped in a range; a decisive move seems due

@rex_cano

Mumbai: The markets have begun the week on a mixed note, with financial shares weakening even as technology shares firmed up. The BSE benchmark index, the Sensex, opened with a positive gap of 140-odd points at 38,275, but immediately slipped into the negative zone. The BSE index thereafter, languished in the negative territory for the remainder of the day. The Sensex finally ended with a loss of 194 points at 37,935.

Among the Sensex 30 stocks, ICICI Bank plunged over 6 per cent. HDFC Bank, Axis Bank and IndusInd Bank dropped over 3 per cent each. Bajaj Finance, SBI, Sun Pharma, Kotak Bank, NTPC, ITC, Bajaj Finserv and Titan were the other prominent losers. On the positive front, Asian Paints surged nearly 4%. HCL Technologies, Infosys, TCS, UltraTech Cement, Tata Steel and Tech Mahindra gained 2-3 per cent each.

As per the daily Fibonacci charts, on Tuesday, in case of an up move the BSE Sensex is likely to face resistance around 38,125-38,185-38,250, and in case of a down move, the BSE index may seek support around 37,740-37,680-37,620.

Also Read: Uptrend intact; Nifty likely to test 11,300 soon

The NSE Nifty has been moving sideways in the last five trading sessions. The NSE index has more or less moved in a range of 11,050-11,250 in the said period. A decisive move seems to be round the corner, in case of down move, the NSE index may slide towards the 200-DMA (Daily Moving Average) at 10,870, while in case of an up move the Nifty may surge towards 11,330. Market volatility is also expected to increase as this week is the expiry of the monthly futures & options for the July series. 

Among the key momentum oscillators on the daily charts, the DI (Directional Index) continues to remain positive, with further strength in the ADX (Average Directional Index). The Slow Stochastic and the MACD (Moving Average Convergence Divergence) are somewhat inconclusive, while the 14-day RSI (Relative Strength Index) has reversed a wee bit from the overbought zone.

Disclaimer: The views expressed in this article are personal and for information purpose only, it does not advocate any buy or sell /recommendation.