RETAIL RESEARCH 18 Feb 2017

HSL Looking Glass
Periodical technical report on Banking & IT sectors…

Nagaraj Shetti
nagarajs.shetti@hdfcsec.com
Tel-022-30750021

RETAIL RESEARCH P age |1

but was not able to sustain the highs and slipped into intraday decline. This week’s high of around 21042 is also an all-time high for the sector. Wipro and HCL Tech NSE BANKING (BANK NIFTY) NSE Bank daily timeframe NSE Bank weekly timeframe Observation: • Daily Timeframe: After showing sideways consolidation in the last couple of weeks. which is suggesting a strong supply zone at the higher levels. Indus Ind bank. Summing Up: • The underlying trend of Banking sector is still positive and there is no formation of any reversal pattern at the higher levels. • We observe a formation of bull candle with long upper shadow. this is going to be a crucial for this sector to maintain positive bias. Hence. • The sector participants like Axis Bank. connecting the two important tops) around 20500 levels. ICICI Bank. RETAIL RESEARCH Sectors CMP Trend Support Resistance Trading Strategy Components expected to perform in line NSE Banking (Bank Nifty) 20551 Up 20300 20900 Buy cmp/sell on rise Axis Bank. • The overall chart pattern of smaller/larger timeframe are suggesting a presence of strong resistance at 20900-21000 levels. RETAIL RESEARCH P age |2 . but also lost some of intra-week gains and closed the week with the net gains of around 338 points. Can Bank and PNB are all showing sideways consolidation with weak bias. Kotak and Yes Bank CNX IT 10527 Up 10450 10650 Sell cmp/sell on rise Infosys. the banking sector opened with sharp positive note yesterday. Hence. • A long range bear candle has been formed as per daily timeframe chart on Friday at the new swing high of around 21042 levels (all time high). Fed Bank. ICICI. BOI. • Weekly timeframe: The banking sector showed sharp upmove during last week. • The banking sector is now facing strong overhead resistance of down sloping trend line (blue line. Yes Bank and Kotak are all showing resistance at highs and other PSU banks like SBIN. TCS. the maximum upside could be limited up to 21K and there is a likelihood of reversal forming at the higher levels. BOB. which is suggesting a strong resistance at the higher levels. as per w-o-w basis.

Summing Up: • A fine upside bounce back of IT sector seems to be completing here and the sector is now set to show some decent correction from the higher levels. which is considered to be a top reversal pattern. The key immediate support of 200day EMA (green curvy line) is now placed at the danger of breaking below it around 10450 levels. • We observe a formation of negative candlestick pattern of ‘dark cloud cover’. as per the concept of change in polarity). Tech Mahindra and Mind Tree are still showing positive trend. RETAIL RESEARCH P age |3 . the IT sector is facing resistance at the strong valuation resistance of around 10650 leves (green dashed horizontal line. • The maximum upside could be limited up to 10650 levels and the confirmation of reversal pattern/correction from the highs could lead IT sector could open up the potential downside levels of around 10150-100 in the next couple of weeks. • We observe a formation of bullish candle with long upper shadow. as per w-o-w basis. RETAIL RESEARCH CNX IT: CNX IT daily timeframe CNX IT weekly timeframe Observation: • Daily timeframe: The IT sector showed decent upmove during this week and closed the week with minor negative note on Friday at the higher levels. Wipro and HCL Tech are all showing negative patterns near the overhead hurdles. • Weekly Timeframe: The IT sector has showed a fine upmove in the last couple of weeks and closed this week higher by around 140 points. This area has been a significant reversal zone over the last two years and has led to a significant reversals in the IT sector in past. Other participants like Just Dial. • The key sector participants like Infosys. TCS. This could also mean that a sharp upside move of IT sector of the last couple of weeks seems to be halting now. • Presently. which is suggesting a supply zone at the high of around 10650 levels.

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