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  • Milan Vaishnav, CMT, MSTA

NIFTY Likely To Consolidate In Thursday's Trade; Undercurrent Remains Buoyant


On much anticipated note, the Indian Equity Markets consolidated at higher levels post the breakout it achieved over previous days. The benchmark Index NIFTY50 oscillated in a very capped range and ended the day flat with negligible gain of 1.05 points or 0.01%. The NIFTY continues stare at some more likely consolidation at higher levels and show the internal strength remaining intact.


Thursday is likely to see a quiet start to the trade. The NIFTY has set a stage for itself wherein it is likely to inch higher but it also possible that it sees some minor consolidation before it moves higher.


Thursday is likely to see the levels of 10965 and 11150 as likely resistance area for the Markets. Supports come in lower at 10850 and 10810 zones.


The Relative Strength Index – RSI on the Daily Chart is 62.9928 and it remains neutral showing no divergence against the price. It is important to note that RSI has broken out of a pattern and is seen inching higher. The Daily MACD stays bullish while it trades above its signal line. No significant formations were observed on Candles.


While having a look at pattern analysis, the NIFTY is seen consolidating at higher levels. It achieved a breakout above the falling trend line pattern resistance. It is seen consolidating after breaking out from the resistance area. Given the present structure of the Charts, it is possible that it sees some more consolidation at higher levels, but it continues to keep it undercurrent strong and buoyant.


Overall, it will be no surprise if we see the NIFTY taking some breather and continues to trade in a capped range for a while. Markets not retracing after couple of short moves on the upside demonstrates the underlying strength and any consolidation, if any, will provide further strength for any up move in future. Any down move, led by consolidation, will be limited. We recommend continue making select purchases. By and large, a positive outlook is advised for the day.


STOCKS TO WATCH:

Resilient technical setup is seen in stocks like INFOSYS, SUN PHARMA, EROS INTERNATIONAL, PETRONET, HIND UNILEVER, BAJAJ-AUTO, JUBILIENT FOODWORKS, GODREJ INDUSTRIES, GOA CARBONS and TVTODAY.


Milan Vaishnav, CMT, MSTA Technical Analyst (Research Analyst, SEBI Reg. No. INH000003341)