Sensex zooms over 3,000 points in two days. Is it time to book profit?

The index had witnessed 10 per cent correction from June, 2019 and an upside of over 5 per cent in the past two sessions has strengthened the positive view on the technical charts

S&P BSE SENSEX: The index has gained over 3,000 points in the past two sessions. The rally comes on the back of a sharp cut in corporation tax announced by the government during market hours on Friday. On the techncial charts, the trend line breakout with huge volumes suggests a strong upward momentum for the index. The index had witnessed 10 per cent correction from June, 2019 and an upside of over 5 per cent in the past two sessions has strengthened the positive view. The level of 39,750 stays as an immediate resistance with support coming at 38,100 and 37,800.  CLICK FOR CHART VIEW

NIFTY 50: The index has scaled above its 200-days moving average (DMA) with the strong volume and stills holds promise. The formation on the charts can be noted as an 'Inverse Head and Shoulder /quadruple bottom' – four bottoms / consolidation breakout. Such moves not only boost the sentiment, but also gives opportunities to investors to add positions on any correction. For the Nifty, 11,800 becomes an immediate resistance with supports at 11,400 and 11,230 levels, respectively. CLICK FOR CHART VIEW

NIFTYBANK:  The index has crossed 100 DMA placed at 29,461 on Monday and is heading towards the pressure range of 30,900 – 31,100 levels. As the index gets closer to this range, one can expect profit booking to set in. The upside sentiment may slow only below 100 DMA. Moving Average Convergence Divergence (MACD) is climbing towards the zero line. CLICK FOR CHART VIEW

NIFTY IT: The IT index slipped over 2 per cent on Monday. If it trades below 15,000 mark for a few more sessions, then one can see a correction towards 14,500 and 14,300. The weekly chart shows chances of a breakdown below 15,000. Even, the MACD indicator is towards breaching zero line down, a sign of bearishness. CLICK FOR CHART VIEW

NIFTY AUTO: As discussed here, the “Symmetrical triangle” has confirmed a breakout, which is a positive sign for the index. After the breakout, the index did witness correction. However, the lower rising trend line at 6,750 was a support. 8,100 – 8,200 becomes the resistance for this upside and a breach of this level with strong volume can trigger a further upside. At the current levels, we can expect profit booking. CLICK FOR CHART VIEW

NIFTY INDIA CONSUMPTION: The index is trading at nine-month high of 5,100 with a breakout of “Rising channel pattern” as per the daily chart. This index can see further upside, as it trades successfully above the 200-DMA. The immediate support comes in the range of 4,900 – 4,800. CLICK FOR CHART VIEW