Uptrend wave may continue in future
n the last week, the benchmark indices bounce back sharply, the Sensex was up by 1031 points.
image for illustrative purpose
Mumbai: In the last week, the benchmark indices bounce back sharply, the Sensex was up by 1031 points. Among Sectors, almost all the major sectoral indices were traded in the green but IT index outperformed, gained over 2 per cent.
Technically, on daily charts the index has formed higher bottom formation and on weekly charts it has formed long bullish candle which is broadly positive. In addition, after long time the index successfully trading above 20 day SMA (Simple Moving Average) level that also indicating further uptrend from the current levels. “We are of the view that, uptrend wave is likely to continue in the near future. For the traders now, 20 day SMA or 58,500 would act as a sacrosanct support zone,” says Amol Athawale, Deputy Vice President - Technical Analyst, Kotak Securities. Above the same the index could rally till 200 day SMA or 59,300 - 59,600. On the flip side, below 20-day uptrend would be vulnerable, he said.
Meanwhile, in the bank nifty, positive sentiment is likely to continue in the near future. For the trend following traders, 40,200 could be the key support level. Above which, it could rally till 50 day SMA or 40800. further upside may also continue which could lift the bank nifty till 41,250. The overall market structure suggesting buying of corrections and sell on rallies would be the ideal strategy for the short term traders.
