Aug 26,2020 Financials will continue to outperform; Nifty too showing strength.

Despite successive bounces, Nifty showed no intention of correcting; this can be taken as a sign of display of strength. Regardless of the fact that the rally is being driven by liquidity, Nifty has made a strong attempt to fill the gap that existed between 11,430 and 11,500 levels. While the index has filled that gap, it has closed in the middle of this band. Any move above the 11,500 level would fuel more strength for the immediate near term.

All in all, we cannot discount the strength that Nifty has been displaying at current levels. However, it would be wise not to anticipate any breakout above the 11,500 level, unless it is taken out convincingly. We recommend following the trend cautiously on the upside while adopting a stock-specific approach. Financials have outperformed the broader market and will continue to do so in the near term.

Importantly, though, one must focus on protecting profits at higher levels with trailing stop losses while chasing the bounce.

Nifty (11466) Technical target of 11660 is still valid as long as 11400’ the Nifty opened with a bull gap traded volatile to close mildly in the green…technically now 11660 is still the target as long as 11440 holds…

Nifty Bank (22833) Technically the next technical targets are now 23195 and beyond that to 23395 is possible as long as 22572 holds’ the nifty bank opened in the green and traded higher to achieve our first target and has closed in the green…technically the trend is still intact up and 23395 is also possible as long as 23000 holds…

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