Nifty Daily Technical View, Decoding Healthy Feature of the Ongoing 3-Month Rally

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Nifty Daily Technical View, Decoding Healthy Feature of the Ongoing 3-Month Rally

By Malvika Gurung

Investing.com -- The Indian equity market is witnessing a lower trading session on Tuesday, following negative cues from Asian peers and dragged by financial and banking stocks.

At 12:33 pm, Nifty50 dropped 0.18% to 18,721.55 levels and Sensex lost 153.1 points or 0.24%. The market volatility barometer India VIX surged 1.3% to 11.36 levels.

In a note provided to Investing.com, Dr VK Vijayakumar, Chief Investment Strategist, Geojit Financial Services said that the market corrected from near record highs and has turned volatile.

He notes that a healthy feature of the ongoing 3-month-old rally is that it has been characterized by corrections which made the ‘buy on dips’ strategy successful. Much of the ongoing volatility in the market is due to sectoral churning happening on a large scale, which has turned Nifty Bank weak, and Nifty Auto and Nifty Realty , strong.

Vijayakumar draws focus on the ongoing sectoral churn and diverse sectoral trends in the market, stating that bank stocks are witnessing profit booking despite sound fundamentals, and this money is moving to autos and realty, thanks to their improving prospects.

On the daily technical view, Anand James of Geojit Financial Services encourages to play for an 18,820 move if Nifty manages to float above 18,750, else expects choppiness to continue. However, he does not expect a collapse.

“Break above 18,820 may not signal directional upsides right away, but a close above the same will encourage us to revive the 19,000-19,070 and 19,200 objectives,” James added.

Read Also: Financials, Banks Exert Pressure on Nifty, SmallCaps Outperform Benchmarks

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