By Ajit Mishra
Markets traded volatile in the continuation to the prevailing consolidation phase but managed to edge higher. The beginning was subdued however gradual recovery in the following sessions not only pared losses but also helped the index to close around the week’s high.
On the benchmark front, both Nifty and Sensex gained over a percent each to settle at 22,040.70 and 72,426.64 levels respectively. Most sectors traded in sync with the move wherein auto, IT, energy and banking were among the top performers. Amid all, the broader indices oscillated sharply on both sides and eventually settled mixed.
With the earnings season behind us, global cues would largely dictate the trend in the coming week. Among the key markets, the US benchmark index, the Dow Jones Industrial Average (DJIA) has been seeing volatile swings and a decisive breakdown of 38,300 could prompt some profit taking to the 37,500-37,800 zone.
The recovery in banking heavyweights combined with rotational buying in other index majors has raised hope of a possible breakout attempt from the prevailing range. However, mixed global cues may continue to weigh on the sentiment and prompt kick-jerk reactions in between.
We are eyeing sustainability above 22,150 to mark the resumption of the uptrend and inch towards the 22,500+ levels. On the flip side, the support has shifted to the 21,450-21,700 zone. Since the majority of sectors are aligned with the benchmark now, participants should continue with a “buy on dips” approach and focus on stock selection.
(Ajit Mishra, SVP- Technical Research, Religare Broking. Views expressed are author’s own. Please consult your financial advisor before investing.)
