The S&P BSE Sensex hit a fresh record-high of 40,931 on November 25 while Nifty50 is just 30 points away from its record-high of 12,103. However, some technical experts feel that it could trade in uncharted territory in the November series.
Both Sensex and Nifty50 rallied more than 1 percent on November 25, and Nifty50 breaking above the crucial resistance level of 12,000-12,050 has opened the door for the index to hit fresh record-highs.
We are already in a bullish trend where one step backward and two steps forward texture is continued in the market. Global cues, especially positive developments on the US-China trade deal front, is driving the latest momentum in the market, suggest experts.
Based on derivative data, short-covering could continue on November 26, and we could possibly hit fresh highs, they say.
“On the derivative front, heavy short positions were created in index future by FIIs around 12,000-mark and there were many short positions at 12,000 strike call option by many traders as the market was showing some tiredness in 12,000-12,100 zone,” Santosh Meena, Senior Analyst- TradingBells, told Moneycontrol.
“But, they (FIIs) didn’t get follow through to their short positions as Nifty witnessed smart bounce back from its 20-DMA of 11,880 with the help of positive global cues that pushed bears on the back foot to cover their short positions and their short covering led a stellar rally in the market,” he said.
Meena further added that there was a good chance that Nifty might hit a fresh high on November 26 and continue its bullish momentum for a move towards 12,300 in this expiry itself.
“On the downside, 12,000 will act as strong support as there is significant put writing at 12,000 strike price,” he said.
Bank Nifty is also likely to take out its previous high of 31,783, and it may head towards 32,500 levels in the coming days where 31,250 will act as strong support in the downside, suggest experts.
Nifty closed at record highs after more than 100 days on the back of positive sentiments and short-covering. Healthy market breadth gives an indication that new highs are around the corner.
The rally was seen in sectors such as metals followed by finance, consumption, and other cyclical space which is very promising.
“Bulls came back with a vengeance. The market breadth was strong as all sectoral indices closed in the green expect media. We have been maintaining our bullish stance on the Nifty and have continued to maintain fresh all-time highs on Nifty above 12,100,” Manav Chopra, CMT, Head Research - Equity, Indiabulls Ventures Ltd, told Moneycontrol.
“Market has gathered momentum to hit fresh all-time highs and the rally looks sustainable as the participation is wider. In the near-term, 12,000 is likely to act as a near-term support zone. The support is placed at 12,000-11,850, and resistance is placed at 12,000-12,100,” he said.Disclaimer: The views and investment tips expressed by investment experts on moneycontrol.com are his own and not that of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.