Auto index rides on sales growth, breaches resistance

Bhagyashree Vivarekar
/ Categories: Trending, Markets

March Auto sales posted favourable numbers wherein the car sales by the top car makers rose nearly 12 per cent on the back of robust urban as well as rural demand. Amongst the car makers, Tata Motors posted 31 per cent YoY growth followed by Maruti which reported 15.01 per cent growth. Among the 2-wheelers Suzuki reported 30.15 per cent growth, followed by Royal Enfield and TVS which posted more than 25 per cent growth each. All-in-all, Indian Auto index rose ahead of and after the release of the numbers.

Barring Maruti Suzuki which could not back the surge in the index, M&M and Tata Motors, which hold 13.4 and 11.8 per cent weightage, respectively in the Nifty Auto index drove the index up. After hitting a kind of Double Bottom at 700 levels, M&M bounced back nearly 80 points and now trailing near to its all-time high levels. Even Tata Motors which has been falling consistently seems to have bottomed out at 325 levels and has bounced back breaking its immediate resistance at 358 levels.

Technically, Nifty Auto Index is constantly rising with baby steps since March 23 from 10,560 and broke out of a small Channel pattern at 10,997 on April 02. The index broke its major resistance at 11,409 and is trailing above the said levels since April 5. Going forward, 11,740-11,800 will act as resistances, while 11,270 followed by 11,115-11,010 as the support.

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