As mentioned in the last week post Nifty opened its way for a 16500-16300 test, that is what it did on Monday afternoon, it tested the 16400 level and bounced from there for the rest of the week.
BankNifty too tested 34000 area as mentioned in the last weekly review. These indices didn’t have any snap back rally rather they just reverted from the oversold area.
On the other hand NiftyIT was the focus sector last week and it recorded significant outperformance and close 3% up for the week.
Nifty : Settling 2021
If you remember the market went through a correction in the early part of 2021 caused by second wave, the correction lasted for 13 weeks approximately 90 days from the high point. In the current context we are done with 9 weeks and approximately 63 day from the ATH into this correction. While the earlier correction was of 8% we have already 12% corrected.
Unless Nifty trades above 17300 comfortably the momentum on upside will be missing. This week is Year-end, Quarter-end, Month-end and an expiry week so a volatile week is expected with bears maximizing on every rise.
Nifty 50 Index (D)
BankNifty : Right on the Edge
BankNifty has been looking very concerning, last week it dropped of a channel which it consolidated for a reasonable amount of the time early this year. If one looks at the individual counters within BankNifty then its not giving much comfort unless there is a reversal from this point itself. If we look at the BankNifty weekly chart its at the lower edge of the channel. 34000 level needs to be watched very closely with +/- 1% tolerance, any break of this level will impact the structure not just for BankNifty but also for the Nifty.
Nifty Bank(W)
Nifty Bank (D)
Sector in Focus : Large and Midcap IT
Last few weeks the focus has been on NiftyIT and it has performed well, as the frontline IT index has started looking confident the Midcap IT custom index has also started warming up after a phase of consolidation. With the current context in all the other main indices NiftyIT is again providing the resilience and cushion for the Nifty.
Select MidCap IT Custom Index (D)
This week Nifty expanded the range from 4.5 to ~7.5%, which might be reasonable enough for the month based on the seasonality. Since the next weekly review would be a summation of 2021 and start of a new year, I will share with you long-term, medium-term and short-term movement based dynamic rating system that I follow for the Nifty since since 2017.
That’s it for this week’s review.
Thank you for your attention.
Anupam- A Little About Market
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Opinions and views provided in this weekly round up are for educational purposes and should not be construed as investing or trading advice.