Nifty continued profit booking for the third consecutive session after hitting 11300 mark, forming a bearish candle on the daily chart and weekly chart, indicating some selling pressure at higher level.
After opening lower today, Nifty remained volatile and hit an intraday high of 11150 in early trade and a low of 11026 in the afternoon.
On the weekly chart, Nifty registered bearish candle formation as it snapped a six week winning streak with a loss of 120 points for the week.
Nifty closed the week on a negative note as it corrected from its weekly high of 11341 to 11026 and paused its winning streak of the last six weeks.
Nifty opened lower and remained volatile with a negative bias for a major part of the session on profit booking in Reliance Industries and HDFC Group stocks.
Global markets were in a consolidation mode and a similar thing played out in India as well; as reflected by the BSE-30 Index which declined 1.3% in the current week. Market mood remained cautious due to insufficient progress on the next round of US fiscal stimulus, worries about credit risks in Indian banks and valuation related concerns. Ultratech Cement, Sun Pharmaceuticals and Tech Mahindra were the top gainers while ICICI Bank, Axis Bank and HDFC Bank lost the most in the BSE-30 Index.
FPIs bought equities worth USD791 mn over the past five trading sessions while DIIs sold USD 593 mn worth of equities in the same period.
Nifty has also broken its previous day's intraday low in closing today. Experts expect consolidation to continue in coming session if the index holds crucial 11000 mark, but if it breaks the same then selling pressure can extend further.
Nifty continued its volatile move as it remained choppy inside a narrow range of 124 points before signing off the session with a bearish candle on both the daily as well as weekly charts. At this juncture market appears to be clueless as technical oscillators both on daily as well as weekly charts offering mixed signal.
Next trading session if Nifty sustains above 11000 level then it can remain sideways with positive bias with limited upsides in the zone of 11300/11350 level but if it closes below 11000 then it shall ideally trigger a fresh bout of selling pressure with initial targets of 10860 level.
I feel Traders looks prudent to remain neutral on long side where as shorting can be considered on a close below 11000 level.
Sector Wise :- Pharma index outperformed the other indices with FMCG, IT and metal ended in the green, while selling witnessed in the energy, auto and infra sectors.
- Someshwar, Technical analyst, Equidius Research