Nifty Outlook: Broader mkts participation to boost benchmarks to new highs

Considering the momentum from the previous trading week, our domestic market started the new week on a flat to positive note and maintained its positive stature for most of the sessions. 

The benchmark index stayed put on the higher grounds, registering fresh highs, but the intense bout of profit booking on the last day led Nifty to have a subdued weekly closure at 22475, procuring a mere 0.25 percent to the bull’s kitty.

The truncated yet eventful week featured many twists and turns, keeping the traders’ fraternity on its toes. Both key indices registered a record high in the week but failed to have a follow-up interest, leading to indecisiveness among participants.  

From a technical standpoint, the index has certainly managed to hold the higher ground, but with the developments in the last session, it would be crucial to watch for the pivotal support zones for the upcoming trading week. 

For now, the immediate swing low of the 22,350-22,300 subzone is likely to provide a firm cushion for any intra-week blip, followed by the 50 DEMA of 22,230 and the bullish gap around the 22,200 zone. 

On the higher end, the record-high zone of 22,750-22,800 seems daunting for the bulls and until we witness a decisive breakthrough, the next leg of rally toward the 23,000 mark seems demanding.

We remain hopeful that broader participation will continue and propel the benchmark to new highs. Strong participation by the high beta index Bank Nifty is crucial to strengthening momentum in the upcoming week.

For the time being, we would remain neutral and the ideal strategy would be to take one step at a time. Considering the domestic scenario, one needs to stay light on positions on either side for key indices. Simultaneously, a check on global bourses is advisable, which may act as a catalyst to dictate the near-term trend for our markets.

===========================

Disclaimer: Osho Krishan is a senior technical & derivatives analyst at Angel One Ltd, views expressed are his own