HDFC Securities says that Indian equity benchmark indices bounced back strongly on Jan 19 after two days of losses. At close, the Nifty was up 239.90 points or 1.68% at 14,521.20.
 
Volumes on the NSE were the lowest since Jan 01. Among sectors, Realty, Metals, PSU Banks, Media, Bank, Auto and Pharma rose the most.
 

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Asian shares ascended on Tuesday as investors bet China's economic strength would help support growth in the region, even as pandemic lockdowns threatened to lengthen the road to recovery in the West. European stocks inch higher on Tuesday, sustained by hopes that an economic recovery following the coronavirus pandemic is not far off.
 
Nifty has bounced back smartly on Jan 19, however with lower volumes. This has raised hopes of continuation in the upmove. Sharply positive advance decline ratio also reinforces this feeling. However it would be interesting to watch as to whether Nifty will cross 14653 and make a new high.
 
After showing sharp weakness in the previous couple of sessions, Nifty witnessed an excellent upside bounce on Tuesday and closed the day higher by 239 points. Nifty opened on an upside gap of 90 points, slipped into a minor intraday weakness in the early part of the session. A sustainable upmove has emerged from the early-mid part and that lasted till the end of the session. The opening upside gap remains unfilled and the Nifty closed near the high.
 
The downside breakout of the immediate support like 10 day EMA at 14350 has turned out to be a false downside breakout and the market witnessed a sharp upside bounce in the subsequent session. The Monday's swing low of 14222 could be considered as a new higher bottom of the ongoing bullish pattern-higher highs and higher lows of the daily chart.
 
The symmetrical pattern of 16-18 sessions of consumption (by the way of upmove or range movement) before one day drop is still on. If HDFC Securities consider the previous two sessions of weakness to this pattern, then HDFC Securities have a possibility of more upside in the near term.
 
Conclusion: The sharp comeback of bulls on Tuesday seems to have changed the sentiment of the market and the short term bearish indications have been negated. HDFC Securities expects more upside towards 14655 and higher in the next couple of sessions. Immediate support is placed at 14450.