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Daily Bank Nifty Technical Report 14 November

Sensex (20194) / Nifty (5990)

Yesterday, our Benchmark indices opened with a downward gap in line with the global cues. Subsequently, every attempt to recover from the lows failed and indices closed on the negative note. On the sectoral front, the Auto, Consumer Durables and Metal counters somehow managed to close in the green; whereas the Realty, FMCG, and IT pack imposed selling pressure in the market. The advance to decline ratio was strongly in favor of the declining counters. (A=1048D=1395)

Formation

  • The ’89-day EMA’ and the ’89-week EMA’ are placed at 19968 / 5940 and 18982 / 5703 levels, respectively.
  • The ’20-day EMA’ and the ‘20-week EMA’ are placed at 20624 / 6125 and 19994 / 5949 levels, respectively.
  • The monthly momentum oscillators are now positively poised; whereas the daily and weekly momentum oscillators are contradictory.
  • On the monthly chart, we are observing a breakout from the ‘Multiple Resistance Zone’ .

Trading strategy:

In line with the previous six sessions, the tug-of-war continued during yesterday’s session as well. In the process, the Nifty has now closed tad below the psychological level of 6000 mark. However, unlike other six sessions, yesterday’s price movement led to a formation of ‘Narrow Range’ candle. This indicates that the market participants are now uncertain as the index is hovering around the strong support zone (5940) of ’89 day EMA’. Hence, any reversal sign in the hourly chart may lead to an immediate rally towards 6043 – 6109 levels. However, any closing below the ’89 day EMA’ (5940) will lead to a significant sell off in the market.

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Actionable points:

View Neutral

Support Levels 5940 – 5877

Resistance Level 6043 – 6109

Bank Nifty Outlook – (10523)

Yesterday, the Bank Nifty opened slightly lower in-line with our benchmark index. The movement during the session was almost a replica of previous few sessions. As a result, the daily chart of Bank Nifty too depicts a ‘Narrow Range’ body formation. Hence, going forward, a sustainable move beyond yesterday’s high of 10653 may apply brakes on ongoing pessimism. In this scenario, we may expect an immediate up move towards 10860 levels.

On the flipside, 10412 would act as important support level in the coming trading sessions.

Actionable points:

View Neutral

Support Levels 10412 – 10274

Resistance Level 10650 – 10860

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