As Sensex, Nifty Touch New Highs, Experts Say “Caution Ahead”
The Sensex and the Nifty, two domestic market benchmarks, closed at new highs on Monday thanks to robust buying across the board and encouraging global indications.
The Sensex hit its fresh record high of 65,300.35 in intraday trade while the Nifty also made a fresh peak of 19,345.10 during the session.
Market experts felt that this is indeed a great time for the investors to rejoice, but with caution. Kush Ghodasara, independent market expert said, “Bullish Momentum Persists. Sensex Achieves 6th Consecutive Positive Close and Hits New High, Indicating Volatility Ahead. Caution Advised with Existing Longs, Set Trail Stop Loss at Today's Low of 64835!"
Shrikant Chouhan, Head of Research (Retail) at Kotak Securities too said the traders need to keep a close watch on the market. “The market's record breaking momentum continued as the robust June GST collections, and the monsoon covering most part of the country in last few days brought cheers to investors. The rally has been mostly due to strong foreign fund inflows and India performing well on most of the economic parameters could further strengthen the fund flows in the near term. Technically, the Nifty hovered between 19250 to 19335 price range, with the short term technical set up still in to the positive side. However, due to temporary overbought conditions we could see some profit booking at higher levels. For traders, 19250-19180 would be the key levels to watch out while 19400-19435 could act as a crucial resistance zone.”
Prashanth Tapse, Senior VP (Research), Mehta Equities said that If the bullish action is any indication, then all eyes will be on the psychological 19500 mark. “Benchmark indices extended spectacular gains for the 4th straight day on the back of strong GST collections in June, easing US PCE inflation which offered relief to investors worried about further interest rate hikes. If the bullish action is any indication, then all eyes will be on the psychological 19500 mark, and above the same bulls will aim for the psychological 20000 mark.”
Rajesh Bhosale, Technical Analyst at Angel One said that the Bulls have continued with their winning streak for the fifth consecutive session. “The first session of GIFT NIFTY (formerly known as SGX NIFTY) had a strong start, which influenced the Nifty benchmark index to open with a gap up for the third consecutive time. Overall, the market sentiment remained positive, with trading activity mostly staying within a certain range. However, prices ended on a high note, registering a comfortable gain of 0.70 per cent and closing above 19300.”
He added, “The bullish trend continues as the winning streak extends for the fifth straight session. After a period of consolidation, the market has quickly surged by over 650 points since last Monday's low. This upward trend is expected to persist in the near future, as indicated by significant breakouts on higher time frame charts. Nevertheless, due to the rapid surge in recent sessions, indicators are entering an overbought zone, and with prices deviating significantly from the 5EMA on the daily chart, there is a possibility of occasional dips or sideways consolidation. In such a scenario, it is advisable for traders to take some profits and view any dip as a buying opportunity. The immediate support level has shifted higher towards 19000, while the immediate reciprocal retracement targets come around 19440 – 19500 levels.”
