After a positive start, the benchmark equity index marked the intraday high point in early minutes of the session. Nifty gradually declined and pared all its morning gains. In the second half of the session, the market stayed range-bound, but within the positive territory. The headline index finally ended the day with a nominal gain of 20.15 points or 0.15 per cent.
The session was dominated with weekly options expiry; 13,150 strike saw heavy Call writing which prohibited the index from settling above it. The analysis for the next session remains quite on similar lines as Nifty has not yet achieved a clear breakout above 13,145, which is the previous high point. Nifty’s ability to move past and stay above 13,145 level will be crucial for any further up move.
F&O data is showing little cues with regard to any directional bias. Given the present technical setup, it would be prudent to keep following the momentum on either side.
However, as long as we chase the momentum on the way up, it would be wise to stay highly stock and sector specific. Select financial services stocks, along with pharma and consumption stocks, are showing relatively stronger performance. IT stocks, given any pullback in the dollar index, is also likely to show some improved relative strength. We reiterate not to preempt the move in any direction and approach the market cautiously while protecting profits.
(Milan Vaishnav, CMT, MSTA, is a Consulting Technical Analyst and founder of Gemstone Equity Research & Advisory Services, Vadodara. He can be reached at milan.vaishnav@equityresearch.asia)
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