At a time when global markets remain volatile, Indian benchmarks emerged as a sliver of green, notching a seven-day winning streak. Both the benchmark indices have given returns to the tune of over 8% in this seven-day winning streak
The 30-stock BSE Sensex sprinted past the 80,000-mark today, the first time since January, to close at 80,116.49 points, 0.7% higher. On the other hand, the Nifty 50 on the other hand inched towards 25,000-mark to close 1,948.4 lower than its all-time high at 24,328.95 points.
Not just the benchmarks, sectoral indices too had something to rejoice through the seven-day party. The Nifty Bank index hit a record high during the period, sprinting past thr 55,000-mark for the first time, whereas the Nifty IT index soared 4% today, marking its biggest single-day gain in nine months, with all constituents closing in the green.
However, the relentless upward run also sparks fears of a halt coming in the way. Some technical analysts also agree, holding a view that the steep gains have pushed the market into an overbought territory, making room for some profit booking to seep through.
“With the index having rallied sharply in recent sessions, a phase of mild consolidation or profit-taking cannot be ruled out at this stage, suggesting a tactical pause may be on the cards before the next breakout,” Dhupesh Dhameja, a research analyst at SAMCO Securities had said in a note.
A breakout past 24,250–24,300 points could ignite renewed momentum, whereas a drop below 23,850 points may lead to mild profit booking towards 23,700 points, Dhameja had earlier said. Today, the Nifty 50 crossed the breakout point he pegged at 24,300-mark.
The bullish sentiment is expected to continue as long as the market is trading above 24,150 points and it could further move up to the range of 24,450-24,500 points, Shrikant Chouhan, head of equity research at Kotak Securities, said in a note. However, if the index falls below 24,150 points, there could be a quick short-term correction up to 24,050-24,000 points, he added.
Profit-booking instances were visible in the banking sector as investors took home some of the gains. The Nifty Bank index closed 0.5% lower after its recent achievement of touching an all-time high. Heavyweights HDFC Bank and Kotak Mahindra Bank were among the top losers, dragging the index lower amid a sectoral rotation by investors.
However, not all the technical analysts are of a similar view. Nirav Harish Chheda, assistant vice president of derivatives and technical research at Nirmal Bang, expected the market to continue its winning streak and is likely to move up to 25,000-mark. “There has been a breakout at 23,800 points and now I think the market will continue to gain from here up to 25,000 points, he added. In trading, a breakout means the price of an asset has moved past a defined support or resistance level, often with increased volume. Chedda has pegged 24,800-25,000 as resistance, whereas 23,800 as support for Nifty.
