We had also expected minor corrective action to set in. In line with that analysis, the benchmark Nifty50 witnessed some corrective action with very limited downside and ended the week with a net loss of 80.20 points, or 0.83 per cent, on the weekly chart.
The forthcoming week is likely to see the benchmark Nifty50 struggle to go beyond the 9,600 mark. The 9,575-9,625 zone remains critical to watch out for in the coming week.
While the 9,625 and 9,710 levels will act as immediate resistance for the Nifty50, the 9,575 and 9,460 levels will offer supports.
The relative strength index or RSI on the weekly charts stood at 72.1133. Though it is neutral, showing no divergence against price, it continues to trade in the overbought territory. The weekly MACD is showing bullish signals, as it continues to trade above the signal line. No significant formations were observed on the candles.
A study of Relative Rotation Graphs or RRG shows Energy, Infra, CNX Midcap and Nifty Junior indices may continue to lag on a week-on-week basis. We will continue to see sustained outperformance in relative terms in FMCG, financial services and banking stocks. The auto counter is likely to strengthen further, while CNX IT and CNS Pharma are likely to consolidate performance.
Important Note: RRGTM charts show you the relative strength and momentum for a group of stocks. In the above chart, they show relative performance as against Nifty index and should not be used directly as buy or sell signals.
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