HDFC Securities says Indian equity benchmark indices rose for a second day in a row on Jan 20 with Nifty making new intraday record highs. At close, the Nifty was up 123.50 points or 0.85% at 14,644.70. Volumes on the NSE were higher than the previous day. Among sectors, Auto, IT, PSU Banks and Media rose the most while FMCG ended marginally in the negative.
 
Global shares were mostly higher ahead of Joe Biden’s inauguration as U.S. president Wednesday, with positive corporate earnings more than offsetting tighter German restrictions to fight the coronavirus in Europe.
 

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Nifty made a new intraday high reflecting the underlying strength in the indices. Its close was the highest ever. Volumes after rising post Jan 04, have come back to normal. Advance decline ratio has improved to much above 1:1. Institutional buying (esp FPI) has gradually slowed however neither the institutions nor the non-institutional participants seem to be in a hurry to take profits even as the Budget looms ahead.
 
Nifty continued with a sustainable upmove for the second consecutive session on Wednesday and closed the day higher by 123 points. Nifty opened on a positive note, shifted into a further upside in the early part of the session before shifting into an intra-day range move. Minor dips of mid part have turned out to be a buy on dips opportunity and Nifty registered a new all time high at 14666 towards the end.
 
The positive sequence like higher highs and lows continued on the daily chart and Nifty is currently making an attempt to reach higher highs. Previously, the short term downward corrections have resulted in a sustainable upside for many sessions. Hence, having moved up sharply from the higher bottom in the last two sessions, Nifty is expected to show further upside gradually.
 
The immediate support of 10 day EMA has proved to be a false downside breakout and that led to a sharp upside reversal. As per this pattern, this 10 period EMA could be tested again during the next dip, after moving into new highs above 14666-14700 levels. On the upper side, the long term trend line resistances (top-top and bottom-bottom, as per monthly chart) could come into play.
 
Conclusion: The short term trend of Nifty continues to be positive and Wednesday's upmove could be a confirmation of bullish reversal from the lows. One may expect further upside for the next few sessions, before encountering next crucial overhead resistances around 14800 levels. Immediate support is at 14550.