Tech View: Can Nifty reach new heights this week?

Thanks to Friday’s rally, which was supported by a significant rise in global markets, Nifty ends another week with respectable gains. Weaker-than-expected US inflation data caused US bond yields and the dollar index to drop dramatically, fueling a strong rally in global equity markets. The Nifty ends at a new 52-week high and Bank Nifty ends at a new all-time high, but the broader market underperformed last week; in fact, the midcap and smallcap indices both recorded losses.

Amid a rebound in international markets, the Nifty is approaching its all-time high; its previous all-time high was 18,604 on October 21. Indian stock markets are constantly receiving funding from FIIs, and Friday marked their 11th consecutive trading session of buying. As US bond yields and the dollar index fall, they could help the market hit a new high. Last week, the Rupee also saw notable strength. Sentiment will continue to be fueled by the movement of global markets. The market will keep an eye on our domestic inflation statistics.

Technically, Nifty is breaking out of a widening wedge formation and closed at important resistance at 18350. If it manages to hold above this level, then we can anticipate a rise towards the 18500, 18600 levels. and 18800. On the downside, 18300 is strong support and the 18100-18000 area will function as an area of ​​immediate demand.

Bank Nifty is currently trading above the psychological threshold of 42,000 and at an all-time high. Bank Nifty’s next logical target is around 43000. In contrast, 41750 acts as instant support, and the 41000-4800 range is a crucial demand area.

If we look at the derivative data, the put call ratio sits at 1.22 and the FII’s long exposure to index futures is 62%, indicating a bullish tilt in the market. According to the open interest distribution chart, there are no substantial hurdles up to 19000, while 18300 and 18000 serve as important support levels.

Pravesh Gour is a senior technical analyst at Swastika Investmart Ltd.

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