Nifty index has been on bull run for more than 20 consecutive sessions now. This bull run can be partially attributed to influence from global markets while major triggers for the bull run can be attributed to earnings season that is ongoing this month. Overall market sentiment remains positive for major heavy weights in stock market which has been evident with positive Q3 financial results update for many major companies seeing over 10% growth while few small scale companies which posted results also provided positive announcements with minimum of 5% increase in value.
Of the earnings from Q3 stocks released so far all banks from both public and private have provided positive Q3 results which has greatly helped shape Nifty’s bull run, With some of reforms made to Govt during the last three months including govt’s decisions to allocate funds for PSU banks to help ease of operations and many private banks starting to clear of their NPA’s and settling debts market has been providing a clear bullish projection for Q3 for some time now which resulted in market seeing an increased cash inflow ahead of earning season during Christmas to New Year holiday season. FMCG sector also saw boost in sales due to festive season adding to positive numbers in earnings data.
This along with Nifty’s bullish run exceeding expectations of many traders by seeing a consecutive uptrend movement for three weeks with new record high being breached every day overall market sentiment has turned positive with many intra-day traders choosing to hold positions for short term to observe how far the market grows before booking profits to reap max benefits from current bull momentum. RSI indicator which is used to predict momentum of price using speed of change in price traded has maintained stance in overbought zone for more than 5 trading session indicating possibility of slow down of current uptrend movement in near future.
While both parabolic SAR & alligator indicators which points out good entry and exit points of trend and when a new trend is forming or existing trend is slowing down have continued to show signs of uptrend movement daily chart and 4 hour intra-day charts, candle movement in min and 1 hour charts show signs of index turning range bound. While we can expect market to continue to trade uptrend across the day and close uptrend for the day, we can see some correction in this uptrend movement soon with expected support values at 10662.33 on first level & 10372.44 on second level and resistance value at 10902.30 respectively.
Image : 4 hrs intra-day data from MCharts MT4 Platform
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