Positive sentiment likely to continue

Mumbai: In this week, the benchmark indices witnessed a volatile activity. After a roller coaster activity, Sensex closed at 65,996. Among sectors, reality index outperformed others and gained nearly two per cent whereas pharma and energy indices witnessed profit booking at higher levels.

Technically, the week opening was negative. After a sharp fall, the index took the support near 64,900 and bounced back sharply. Currently, the Sensex is trading near 50-day SMA (Simple Moving Average) and on weekly charts; it has formed Hammer kind of formation, which is largely positive.

“We are of the view that, as long as Sensex trades above 50-day SMA or 65,600 the positive sentiment is likely to continue. Above the same, the Sensex could move up till 20-day SMA or 66,500 further upside may also continue which could lift the index till 66,650,” says Amol Athawale of Kotak Securities.

On the flip side, fresh sell off possible only after dismissal of 65,600 below the same, the market could retest the level of 65,300-65,000. For Bank Nifty, 44,000 would act as a key support zone. Above the same, it could rally till 50-day SMA or 44,800-45,000. On the other side, below 44,000 uptrend would be vulnerable.

The market, however, reacted positively, as the status quo on the growth rate and a further drop in oil prices provided near-term support.