Bullish trend seen in Infra, Realty, PSU Banks
Bearish bias likely to continue
Nifty ends down as selling pressure mounts near its crucial 20 Day MA. The benchmark is technically facing key resistance at 20 days MA which is placed at 18,083 and seeing continuous supply at higher levels. On a Shorter time frame, hourly, the formation of price action suggest a lower high lower low and current range of 18,080 on the higher side and 17,750 marks a zone for this price action. A break below the 17,750 levels would further push bulls to the backseat and bears aggressively taking Nifty to much lower levels of 17,600 – 17,400.
As far as Nifty is below 18,350, we may not see an uptrend confirmation. Only a stock-specific approach should be taken into consideration.
17,400 is an important support as it's a low formed during September post which we have seen Index making a new All-time high. 20 Day MA is now red for the first time since July last week signaling a consolidation with correction continuation may be followed. The MACD line is down on a rolling basis and well below the signal line. While the Histogram suggests a rebound from lower levels but is still below 0. The RSI is also sideways and below the Balance 50 mark. As pointed out previously, as far as prices are between the 20 Day and 50 Day MA we may see consolidation and complex structure continuation.
FIIs have been pulling out but that is the due course of action when western markets have been trading at all-time highs, breakouts in Russell200, a small-cap index and with that financial year-end and a festive season in December. So this may be reflected in the Domestic market and we may see some fresh momentum in December coming back into the market.
We remain bullish but on select spaces such as Infra, Realty, PSU Banks and stock-specific approach.
(The author is Technical Analyst at Finversify)