Dalal Street Week Ahead: Nifty in uncharted territory; protect profits at higher levels
The trading range got wider as Nifty moved in a 555-point range. The financial space continued to relatively underperform the frontline Nifty. The headling index closed on a strong note with a net gain of 523.55 points (+2.80%) on a weekly basis.
The month ended as well and Nifty closed with a net monthly gain of 654.65 points (+3.53%). Until now, the banking and financial space has grossly underperformed the Nifty50. Bank Nifty ended on a strong note and remains on a verge of a breakout.
For a sustainable breakout to take place, this key index needs to confirm with Nifty and attempt a breakout. Nifty has dragged its support higher to 19,000 going by the derivatives data. In the event of any consolidation, this level is likely to provide support.
The volatility, meanwhile, continued to remain low. The India VIX came off by 3.87% to 10.80 and this can be considered as one of the lowest points seen in recent years. This makes it near-mandatory for the participants to stay extremely vigilant and protect profits at current levels.
Monday may see the week starting on a positive note. For the breakout to get confirmed, it would be crucial for the Nifty not to slip below 18,900 levels. The coming week is likely to see the levels of 19,280 and 19,400 acting as resistance points while the supports are likely to come in at 18,900 and 18,680 levels.
The trading range is likely to stay wider than usual as the index now trades in uncharted territory. The weekly RSI is 68.14 and continues to stay neutral. It does not show any divergence against the price.
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