Though Max Financial Services might look lucrative after a 33 percent up move in the current month whereas broader market almost remained negative. But one needs to be cautious and look at the bigger picture.
January 30, 2023 / 06:25 AM IST
It was truncated, but the week ended January 27 has been one of a rough ride for the bulls on Dalal Street. The Nifty remained in the red for the past three consecutive trading sessions and Friday came like a doomsday with the index breaking the supports at 17,775 – 17,750 and, eventually, closing with a loss of over 2 percent near 17,600.
We observed a trend move on the downside during the week. The upside resistance was at 18,200 and the index turned precisely from there and now we have a confirmed breakdown below 17,775. The breakdown has a shape that resembles a bearish flag pattern and if this works then we might see the targets of 17,200 – 17,000 in the coming few weeks. The pattern will get negated only above 18,200. The view is clear that till the time 18,200 is not taken out, we are in a sell-on-rise mode.
The Nifty Bank index took most of the beating since the index was down by more than 5 percent during the week and almost retested the 40,000 mark. Previously we had a view that below 41,500 the index can go down towards 40,000 but that might act as psychological support. A similar kind of movement was witnessed since the support of 40,000 is still not broken.
Going ahead a breach of the same might intensify the selling pressure that the index might be heading toward 38,000 mark. On the upside; resistance is placed at 41,500 for the time being.