Week Ending November 22nd 2024

Dear patrons, in a truncated week, bulls finally came into their own and handed over a thumping to the bears. Nifty gained over 2% on Friday to close a timid week in the green. Other indices followed suit with the IT index gaining handsomely.

Global markets were mostly positive, with the US markets leading the way. Election rally is still ON in the US and may well last a bit longer. The US markets seem to be ignoring the rising bond yields and strengthening $. 

Domestically there was stock specific action in Adani group of companies, which resulted in some negative move on Tuesday. Some New York court has indicted the group for alleged corruption in India. In our view the US court has no locus standi in Indian affairs and the US court ruling deserves to go to only one place and that is the DUSTBIN. The markets also shrugged off the negative news and zoomed towards 24000 on the Nifty towards end of the week.

As per Dow theory "market discounts any information" was on the fore Friday. Election results in Maharashtra were expected to be favorable to the ruling parties, which bolstered the investor confidence resulting in a handsome gain. There may still be some more legs to the rally as results have come out better than expected.

Let's try and figure out what lies in store for the coming week.

As we can see in the above chart, Nifty after breaking 23800 had a sharp fall as suggested in the previous blogs. We had also mentioned that 23200 should act as a support (you may read about it here Weekly Market Update: Week Ending November 15th 2024). After breaching 23800 Nifty fell sharply and made a low around 23250. After Friday's pull back 24050-24100 should act as resistance. A close above 24350 will be the first sign that we are out of the woods and a fresh rally can be seen. 23500 should act as support followed by 23200 as strong support in the short term.

BankNifty also registered some gain on Friday but lagged far behind the Nifty. It has closed above the crucial 51000 level. Immediate support for BankNifty lies around 50800 and strong support lies around 49900. On the upside BankNifty looks set for some fireworks. Resistance for BankNifty is placed around 51500-51600 levels followed by 52100-52200 for the coming week.

Action is expected to be stock specific for some more time. Accumulating good quality stocks should reap handsome rewards in coming time.

Stay Invested!!!

P.S.: This communication is for educational purpose only and does not recommend buying or selling any stock or index. Trade at your own risk.