On the weekly expiry day of the last week, the market had a rough day which was mainly due to negative development across the globe. Fortunately, the fall got arrested and Nifty eventually concluded the week tad below 15,700.
In the last month or so, we have seen multiple attempts to reach the millstone of 16,000.
The way we closed last Wednesday, we were all set to see the magical figure, but global sell-off was the spoilsport. There was no follow-through to this selling momentum as we saw Nifty stabilizing after entering the key support zone of 15,650 – 15,600.
When the market fails to surpass a specific level after multiple attempts, it is considered an ominous sign. But there has not been any brutal correction so far which bodes well for the bulls.
After the last two days of price action, our confidence in predicting Nifty at 16,000 or beyond in the ongoing rally has certainly shaken a bit, but we would still remain hopeful as long as Nifty holds a strong support zone of 15,600 –15,450.
If these levels are violated then one should get prepared for a decent short-term correction in the market. Until then, better to trade with a positive bias.
During the first half, 15,750 – 15,800 are the levels to watch out for and the first sign of strength would come only after reclaiming 15,800 on a closing basis.
We reiterate that if this has to happen, the banking sector continues to be the key factor as it’s trading around its crucial support area.
Traders are advised to remain light and stick to a stock-centric approach by following strict stop losses. Also, it’s important to keep a close eye on the global developments as well.