Index trend and stocks in action October 30, 2019
The bulls have finally put an end to the broad movement in a style, which was seen in the last 5-6 sessions in the markets. The day would have not been better than this as it was the first full trading session of the Samvat 2076. On an intra-day basis, Nifty crossed the important psychological 11,800 mark for the first time since July 5; however, it closed at 11,787 levels, up by 1.37 per cent. The price action of the day formed a sizable bullish candle that has witnessed a decisive upside breakout of broad range consolidation phase.
If you recall, we had clearly stated in our previous note that bears would be extinct in the markets above 11,720 mark. We hit a bull’s eye on this as, once the 11,720 level was breached, there was no looking back and markets were on a song. Technically speaking, the price action finally broke out above the broad trading range and, we believe, there is more steam left on the upside. Its seems Nifty is heading towards levels of 11,980 mark in the short term. The upmove might not be in a straight line, hence, the immediate resistance level of 11,860 needs to be crossed and index might take a breather around these levels before surging to our final target of 11,980. Meanwhile, the levels that formed resistance earlier, will act as support on the downside, that is, the level of 11,700-11,720.
Overall, the bulls are in the driver seat and, we believe, there is still some steam left on the upside until the music stops and actually breaks the key support. We would advise traders not to argue against what the market is telling you through the price action. Just hop on and ride till the wheels fall off, then rotate into opposing direction, when bears get resurrected again by decisively breaking immediate support levels.
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