Week Ahead

The BSE Sensex reclaimed the psychological 60,000 mark last week, rising 183 points to close at 59,646, and the Nifty50 moved closer to 18,000, up 60 points at 17,758, while the Nifty Midcap 100 and Smallcap 100 indices gained 0.6 percent and 0.4 percent.

FMCG, infrastructure, energy, and realty indices gained more than 1 percent each, whereas pharma, oil and gas, and banks closed in the red.

As we have an expiry in the coming week and rally through the past five weeks, consolidation and volatility are expected to continue with focus more on global cues.

Technically Nifty50 has seen formation of bearish Engulfing pattern on the daily charts as it engulfed gains of last three days, snapping eight-day winning streak. It was down more than a percent compared to previous day amid profit taking after crossing the long downward sloping resistance trend line adjoining previous swing highs which experts were indicating overbought levels.On the weekly scale, there was small bodied bearish candle formation, after four bullish candles in previous four straight weeks.

In coming sessions, the low of Friday's candle (17,710) could act as an immediate support for the market, followed by 17,500 and 17,300, while 17,992 could be near term resistance for the Nifty50.

We have monthly expiry of August futures & options contracts on coming Thursday as market participants will close their current month positions and rollover the positions to next month. Hence there could be some kind of volatility can't be ruled out in the coming week, and 17,000, which have maximum Put open interest, could act as a crucial support, while 18,000, which have maximum Call open interest, may be crucial resistance for the Nifty.