Market Outlook: Uptrend continues; Fresh gains for Nifty likely above 11,450

@rex_cano

Mumbai: The markets witnessed yet another winning trading session on the back of positive momentum and follow-up buying in select financial majors. Global cues were once again largely supportive as the US based tech index recorded yet another life-time high on Tuesday. The S&P 500 index also hit a fresh all-time high.

Back home, the BSE benchmark index, the Sensex, opened with a positive gap of 200 points at 38,727, and soon touched a high of 38,789. The BSE index, thereafter, pared some gains and consolidated in the positive zone for the remainder of the day. The Sensex eventually settled with a minor gain of 86 points at 38,615. Despite recovering as much as 40 per cent from its March low of 27,500, the BSE index is yet another 9 percent away from its life-time peak. 

Among the Sensex 30 stocks, Tech Mahindra, Bharti Airtel, Maruti Suzuki, ICICI Bank, HDFC Bank and SBI gained 1-2 per cent each. On the other hand, Bajaj Auto and ONGC declined around 1.5 per cent each. Nestle India, Hindustan Unilever and Kotak Mahindra Bank were the other notable losers, down around a per cent each.

Also Read: Market Outlook: Nifty needs to break above 11,415 for fresh upside momentum

The BSE Sensex continues to remain in a buoyant mood as per the weekly and monthly Fibonacci charts. As per the weekly Fibonacci chart, the BSE index is likely to get considerable support in the range of 38,200-38,075 in case of a down move. Whereas, the monthly bias is likely to remain positive as long as the BSE index sustains above 37,600-level. On the upside, the BSE index may target 39,000-mark, today the index hit a high of 38,789.

As per the daily Fibonacci charts, on Thursday, in case of an up move the BSE Sensex is likely to face resistance around 38,700-38,730-38,760, and in case of a down move, the Sensex may seek support around 38,520-38,490-38,470.

The NSE Nifty traded above the 11,415-level for a major part of the trading day, but eventually failed to close above it. The NSE index ended with a modest gain of 0.2 per cent at 11,406. There were a couple of negative points in today’s close, one the NSE index failed to close above the higher-end of the Bollinger Band and secondly the day’s close was below the day’s open. Hence, one may need to be a bit cautious tomorrow.

As per the daily charts, the higher-end of the Bollinger Band is now around 11,450-level. The Nifty needs to break and close above this level for fresh upside momentum. Failure to break and close above 11,450, can trigger a fresh round of correction towards the 20-DMA (Daily Moving Average), which is currently around 11,210-odd level. Having said that, the bias continues to remain positive and a break and close above 11,450-level for the Nifty can open the doors for a potential rally towards 11,800-level. 

Among the key momentum oscillators on the daily charts, the Slow Stochastic and the DI (Directional Index) continue to remain in favour of the bulls. The MACD (Moving Average Convergence Divergence) remains inconclusive and the 14-day RSI (Relative Strength Index) is in the neutral mode.

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