THE NIFTY STARTED THE WEEK ON A SUBDUED NOTE HOWEVER ELEVATED BUYING DEMAND

The Nifty started the week on a subdued note however elevated buying demand helped index to resolve higher and record fresh all time high. As a result, index approached our target of 18900. The weekly price action formed a bull candle carrying a higher high-low, indicating continuance of upward momentum 

The breakout from 13 months range supported by across sector participation signifies resumption of structural up trend that makes us reiterate our constructive stance and expect Nifty to gradually head towards 19400 in coming weeks. However, the move towards 19400 would be in a non linear manner as bouts of volatility amid global development can not be ruled out wherein we expect broader market to relatively outperform as it is resolving out of three months higher base formation. Thus, dips should be capitalised on as incremental buying opportunity as we expect any temporary breather to get anchored around key support of 18300. The aforementioned positive stance is further validated by following observations: a) Market breadth measured in terms of percentage of stocks above 200dma surpassed 65% for first time in 11 months indicating broader participation b) Dow Jones Industrial retraced last falling segments high in faster time as 9 week decline was retraced in 6 weeks, first time since January 2022 highs c) Dollar Index and US 10Y yields continue to form lower high-lows after breaking from rising channels indicating further downsides. Both have inverse correlation with equities d) India VIX made lowest monthly close since August 2021 with lower high-low indicating lower risk perception by market participant

Nifty Bank: 43103

The weekly price action formed a small bull candle with an upper shadow signalling profit booking at higher levels after sharp up move measuring 15 % in past nine weeks 

We expect the index to maintain positive bias and head gradually towards 44600 levels in the coming weeks being the 161 . 8 % external retracement of the September 2022 breather (41840 -37387 ) . Dips should be used as a buying opportunity index has strong support placed around 41800 levels