Mkt may hold uptrend as Sensex forms bullish candle

The 30-share index BSE Sensex on Tuesday bounced back sharply as it’s up by 446 points. Among sectors, almost all the major sectoral indices were traded in the green, but reality, banking and financial stocks outperformed.

Technically, after a gap-up opening, market successfully cleared the 63,200 resistance zone and post breakout it intensified the positive momentum. On daily charts, the index has formed bullish candle, which supports further uptrend from the current levels.

“We are of the view that, the positive sentiment is likely to continue in the near future. For the bulls now, 63,700-6,800 would be the immediate resistance zone,” says Shrikant Chauhan of Kotak Securities.

On the other side, below 63,200 levels, traders may prefer to exit out from the trading long positions. Below which, the market could retest the level of 63,000-62,900.

“We are of the view that, currently the market is witnessing non-directional activity; perhaps traders are waiting for either side breakout,” says Chauhan.

For the day traders now, 63,100pts would be the key resistance level, while 62,850 could be the crucial support zone. Above 63,100 levels, we could see fresh uptrend rally till 63,400-63,500. On the flip side, below 62,850 selling pressure is likely to accelerate. Below which, the market could slip till 62,600-62,500.

Vinod Nair, head (Research), Geojit Financial Services, says, “The domestic market rallied, primarily supported by banking and finance stocks, which received a boost from the merger updates from HDFC. Meanwhile, global trends were mixed as the Chinese market showed signs of recovery, driven by hopes of additional policy stimulus, whereas European markets traded with declines in response to hawkish commentary from the President of the ECB.” Ahead of the release of US stock data, oil prices eased as concerns regarding Russian political instability and potential supply disruptions were alleviated.