Week Ahead....

The market gained nearly 1 percent for the week ended November 29, continuing the upward rally for another week, signalling positive sentiment after recent correction and consolidation.

The BSE Sensex rose 0.87 percent during the week to 79,803, and the Nifty 50 jumped 0.94 percent to 24,131, while the broader markets outperformed the benchmark indices as the Nifty Midcap 100 index climbed 2.5 percent and Smallcap 100 index rallied 5 percent.

Stability in the market will depend on the steadiness of the incoming economic data next week, while investors will be more inclined to act on the upcoming RBI monetary policy.

Next week, all eyes will be on the last Monetary Policy Committee meeting of the current calendar year scheduled on December 4-6. Despite slowdown in growth in September quarter, most experts do not expect any change in repo rate given the inflation climbed much above the RBI's target of 4 percent, at 6.21 percent for October against 5.49 percent in the previous month on higher food prices. According to them, the interest rate cut may start either in February or April's policy meeting. Overall the commentary with respect to the timeline for beginning of rate cut cycle and growth forecast by the central bank is the key to watch.

Technically, the Nifty 50 stayed well above above 50-week EMA, and formed bearish candlestick pattern with long lower shadow and minor upper shadow on the weekly charts, indicating buying interest at lower levels. The index tested 10-20-week EMAs but could not close above the same, while it still traded in the lower band of Bollinger bands, which is a negative sign. The index needs to surpass and sustain above 24,700 for entering the upper band of Bollinger Bands for strong upward rally, while the strong support is placed at 23,250-23,300 zone. In immediate term, it may face hurdle at 24,350, followed by 24,550, while the support is seen at 23,900.

According to the weekly options data, the Nifty 50 is likely to trade in the 24,000-25,000 range. If it breaks the range on lower side, the support is placed at the 23,800, while on the higher side, 25,500 is the level to watch.