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The BSE Sensex, Nifty 50 and Nifty Bank have closed on a strong note in the March expiry, with the oscillator reflecting a positive divergence. The resilient move in the final hour of the derivative expiry strengthened the Relative Strength Index (RSI).
Positive divergence happens when the technical oscillator leaps over the previous reading, while the price trails to cross its last peak. This structure denotes underlying strength of the indicator, suggesting the trend is anticipated to move in the same direction.
All the key indices endure positive divergence now, which is intended to be directional for a short-to medium term perspective. On Monday, BSE Sensex and Nifty gained over 1 per cent, while Nifty Bank was seen trading 1.40 per cent higher.
Here's is the technical outlook on benchmark indices amid positive divergence of RSI:-
Here's is the technical outlook on benchmark indices amid positive divergence of RSI:-
S&P BSE SENSEX
Outlook: heading towards 59,000 & 62,000
The recent sessions have seen the BSE Sensex seizing downside close to 57,400 level, a small consolidation that may eventually lead to a clever uptrend, as the RSI makes a positive divergence, as per the daily chart.
The index could rally towards the upper falling trend line and reach 59,000-mark. When that happens, the overall chart scenario may see a “Double Bottom” breakout, eventually moving in the bullish hold reaching 61,000 to 62,000 range. CLICK HERE FOR THE CHART
NIFTY50
Outlook: Towards 17,400 and 18,000 levels
The positive divergence could lead to an up move towards 17,400-mark, the hurdle of the lower falling trend line. The support for the trend exists at 16,900 level, where the index managed to see accumulation in last four sessions.
A breakout over 17,400 could propel index to much bigger heights in the medium-term run. As of now, the trend appears optimistic for upcoming sessions, with sentiment eyeing 18,000 levels. CLICK HERE FOR THE CHART
NIFTYBANK
Outlook: Next reach 41,300 and 43,000
Nifty Bank index is well poised over the support of 39,200-mark, as per the structure displayed by the daily chart. A move over 40,200-level shall spark a rally in the direction of 41,300 levels, as the positive divergence clearly shows an underlying trend to support the up move sentiment.
The present belief towards the Nifty Bank index remains lucrative in comparison to Nifty index, as the breadth continues to support reversal in the banking stocks. The index overall trend appears to be heading in the direction of 43,000.CLICK HERE FOR THE CHART
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