37,300 level crucial for Sensex. A dip below this can trigger a correction

After gaining since the past few sessions, the markets witnessed choppy trade on Tuesday with the benchmark indices - the S&P BSE Sensex and the Nifty50 - failing to hold on to gains in intra-day deals. The trend among Nifty sectoral indices was largely negative, led by Nifty PSU Bank index, down 2 per cent. Experts said investors are hoping that the US lawmakers reach an agreement regarding a stimulus package.

Will the markets be able to hold on to higher levels going ahead or will they succumb to profit booking? Here are key levels you need to track.

S&P BSE SENSEX:  The recent sessions have seen a strong recovery form the 200-days moving average (DMA) located at 37,570 levels, with price reflecting strength and an upside momentum. That said, this index needs to clear a minor hurdle of 50-DMA placed at 38,296 to rally in the direction of 39,000. The trend, for now, remains bullish that may see follow-up buying resulting in a sharp upside. Going forward, till index defends 37,300 on the closing basis, the upside bias may see buying on corrective moves. CLICK HERE FOR THE CHART
 
NIFTY50: When looked from a broader perspective on the daily chart, the scenario indicates a major breakdown of “Inverse Head and Shoulder,” which gets active below 200-DMA currently set at 10,750 levels. Till the index is able to defend the 200-DMA, the upside may see 11,600 levels in the days ahead. The moment the index clears minor hurdle of 50-DMA located at 11,304 decisively, the strength of the Relative Strength Index (RSI) may further push the index higher. CLICK HERE FOR THE CHART
 
NIFTYBANK: The constituients of this index have been a key driver of the frontline indices over the past few sessions. A dip in the oversold condition of RSI has seen a sharp recovery in Nifty Bank. This suggests the downside is capped around recent range of 20,500 to 20,400 levels in the short period. On the higher side, the immediate hurdle is at 22,000 mark, which if gets conquered, may take the index towards the 23,200 mark. CLICK HERE FOR THE CHART