According to Mazhar Mohammad, in next trading session a close below 11,630 can act as a confirmation for short term weakness that can set a bearish tone for the near term
Nifty is trading above 20, 50 and 100-day SMA which are important short term moving averages, indicating positive bias in the short term.
For FY20, we expect markets to be rangebound as earnings recovery is likely to be delayed owing to slowing global growth and after effects of liquidity tightness seen in 2018
Nifty index trading above 11,640 will accelerate upmove taking it higher towards the target of cup and handle pattern formed on a lower time frame which comes to 11,740 mark.
For this week, Nifty has strong support at 11,565-11,500 and resistance at 11,700-11,760
PCR (Put Call Ratio) is placed at a comfortable level of 1.49. A significant move above 1.85 could see some consolidation coming in
We believe ongoing consolidation would help it to cool off the overbought situation of the weekly stochastic oscillator (at 90), in turn, making the market healthier.
Now, Nifty50 index has to hold previous hurdle of 11,550 zone to extend its gains towards life time high of 11,760 zone while on the downside support is seen at 11,450 and then 11,380 levels.
We believe that India is still a stock-pickers market, with the potential to generate good alpha over the long term by active fund managers.
Momentum indicators on weekly as well as monthly chart are trading in fairly bullish zone and market is trading above all major moving averages.
The metals sector which has long been preparing itself for this move seems to be fully prepared to go full-out and perform itself in the April series.
Apart from the banking pack, stocks like Aurobindo Pharma, Infosys, Jindal Steel & Power, Page Industries, Petronet LNG, Pidilite Industries and Voltas look strong on charts and have the potential to do well in the near future.
Ratios are not so widely used and discussed as it requires execution of three trades to take a position in one underlying
Dyaneshwar Padwal of KIFS Trade Capital said the Nifty may trade rangebound between 11,300 and 12,000 levels during the April series
Mazhar Mohammad of Chartviewindia.in said at this juncture, any correction is still looking like a buying opportunity.
The Nifty internals suggests that recent rally has been broad-based as compared to previous ones as 29 stocks from the index have outperformed Nifty so far
Considering the overall derivative data, we are expecting a continuation in the ongoing optimism in Nifty towards 12,000 mark.
For time being, Mazhar Mohammad advised short term traders to maintain long positions with a stop below 11,450 on closing basis and look for new life time highs
With improved credit growth and higher project activity, PSU banks are likely to benefit. Private banks have shown resilient growth along with acceptable NPA ratios, he said.
Majority of the FY20E earnings growth in Nifty will be driven by the banking sector followed by automobiles, and oil & gas sector.
According to Mazhar Mohammad, strength on Nifty can be expected only on a close above 11,550 levels which shall then pave the way for test of life time highs placed around 11,760 levels.
Talking about global markets, Prasanna said: "As the US growth tapers off but doesn't go into recession but at the same time the forward-looking rate hikes have gone away and forward-looking rate cuts have come in."
There has been a marked improvement in the NPA levels but it may be still early to call a bottoming out of the NPA cycle. Also, we need to see profitable credit pick-up in PSU banks.
Volatility has seen steady rise in last couple of weeks. Hence further rise above 17 will be a cause of concern for the market.
Mazhar Mohammad advised traders to go long with a stop below 11,349 levels and look for initial target of 11,572 beyond which new highs are quite possible