DSIJ Mindshare

Indian stock markets retreated after three consecutive upticks on Tuesday, all thanks to the PSU banks. Nifty PSU Bank index plunged more than 3 per cent after six straight upbeats, dragging the entire market downwards. A pullback after a breakout or a total turnback is just a matter of time.

Nifty is trailing below its 200-days EMA support level of 10,114. It has just touched our next major support at 9,955. Going forward, we hold 9,685 as a major support which would also act as provisional trend reversal. Till then 9,850-9,775 will acts as the immediate support levels.

Indian stock market bulls finally surrendered after tremendous struggle to sustain above the support levels. We hold 10,100 followed by 10,033 as immediate supports. The 9685 level is a major reversal for the Nifty in the medium term. On the upside, 10315-10375 followed by 10,425 will act as resistances.

Bank of Baroda, the public sector bank with 58.7 per cent government stake, surged more than 8 per cent influenced by the release of its Q3FY18 results at the end of last week. The bank succeeded in breaching its fifth consecutive day of consolidation with volume spurt.

Nifty PSU Bank index has formed a 'falling wedge' pattern on the daily charts and witnessed has a breakout at 3650 on January 17. The breakout was after the index took support at 61.8 per cent retracement level which was also its 200 Days EMA support level.