Nifty on the verge of breakout from consolidation: Angel Broking

Mr. Ruchit Jain, Equity Technical Analyst - Angel Broking

"The index opened on a positive note around the 9400 mark following the global cues. However, Nifty corrected from the opening levels in the first hour to test the low of 9260. For rest of the session, it crept higher and ended the day tad below 9400, with gains of over a percent.

In last few sessions, Nifty has been consolidating and the range has narrowed with the passage of time. On the daily chart, the index has been trading in a 'Wedge' formation and prices are now approaching the apex of the pattern. Usually, breakout from such consolidations lead to a directional move and hence, a breakout beyond 9400 should lead to an upmove in the index towards 9600-9700. The recent under performing Bank Nifty too witnessed good momentum today and hence, stocks from this sector could see some catch up move to cover up the under performance. The immediate supports for Nifty are now placed around 9250 and 9140 and till these supports are intact, traders are advised to trade with a positive bias.

As mentioned above,stocks from banking and the NBFC space which has recently showed under performance have showed some signs of relief move today. Hence, we could see some decent up move if the market moves higher and thus, short term traders should look for stocks form this sector from a momentum perspective."

Source : Equity Bulls

Keywords