Market Wrap-up by Mr. Ruchit Jain (Senior Analyst - Technical and Derivatives, Angel Broking):
"Nifty started the session with another gap up opening well above the 11800 mark. It continued the momentum and even tested 11900; however, some profit booking was seen in the penultimate hour due to which the index gave up some of the gains and ended around the opening levels, up by almost 100 points.
The U.S. markets had a run up yesterday night and amongst our domestic news flows, the IT giant TCS announced its quarterly results which obliged the market participants. This resulted in optimism at the open and hence, we witnessed another gap up opening. Although the index rallied to test the 11900 mark, the participation from the broader markets was missing as the midcap stocks had a quiet day. Infact, we witnessed some decent profit booking in the later half which resulted in formation of a 'Doji' (indecisive) candlestick on the daily chart of Nifty. If we look at this week's overall price action so far, the indices have rallied due to participation from the heavyweights (especially IT) while the midcap index has consolidated within a range. The Nifty Midcap50 index is at its crucial point around a trendline resistance which is arrived by joining recent intermediate highs. If the index manages to surpass this hurdle which is placed around 4775, then only we should see a continuation of the rally from the broader markets. However, until then its better to avoid aggressive bets and rather look for stock specific opportunities which are participating in this upmove. As far as index levels are concerned, the 20 EMA on the hourly chart has not been breached in the recent upmove which is placed around 11745 and is seen as important support whereas the immediate resistances are seen around 11900 and 12000 mark.
While IT space took the leadership again at the open to take the benchmark higher, the midcap stocks witnessed some profit booking and the Pharma names were buzzing in the closing hour. This indicates more of a stock specific action in the market and hence, traders are advised to focus on such stock specific moves from a trading perspective. As mentioned above, the Midcap index is at a crucial point and hence, traders should look to participate in this space only on a breakout above the mentioned resistance level."