Wkly Tech Analysis: Momentum in favour of the bulls
Markets ended the extended week with solid gains, thanks to the late week booster from the global markets. The Sensex touched a high of 17,773, and ended the week with a gain of nearly two per cent at 17,750.
The US Federal Reserve meet on September 12 and the Reserve Bank of India's mid-term policy review on September 17 are likely to be the major events next week.
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Among the Sensex stocks, Maruti Suzuki India Ltd rallied over six per cent to Rs 1,212. Infosys Ltd, Tata Motors Ltd, Bajaj Auto Ltd and Hindustan Unilever Ltd surged four-five per cent each. On the other hand, Bharat Heavy Electricals Ltd shed 5.5 per cent at Rs 202. Tata Power Co Ltd and ITC Ltd were the only other notable losers.
As per the monthly Fibonacci chart, the Sensex seems to have tentatively taken support at around 17,250-odd levels, and then bounced back. The bias is likely to remain positive as long as the index sustains above 17,430. On the upside, the index can test 17,900-18,000.
Next week, the Sensex is likely to seek support around 17,550-17,490-17,425, while face resistance around 17,950-18,010-18,075.
The NSE Nifty moved in a range of 150 points. The index from a low of 5,216 recovered and rallied to a high of 5,366. The Nifty finally settled with a gain of 100 points at 5,359.
The NSE index seems to have bounced back from the support of 5,220 mentioned last week. The support has now moved higher - near support around 5,330 and far-off support around 5,275. The overall will positive as long as the index sustains above 5,275.
The momentum seems to be in favour of the bulls for now. The weekly charts indicate sustained trade above 5,260 can help the index rally to 5,500-odd levels. The price and moving averages action, MACD and Stochastic Slow are all in favour of the bulls.
Next week, the Nifty can seek support around 5,300-5,285-5,265, while face resistance around 5,415-5,435-5,450.