StockEdge Morning Market Update - 2nd Sept
The Nifty gained 412 points over the week to close at 25,235. The index consistently made higher highs, demonstrating robust momentum with minimal volatility—a positive sign for the market. The IT and Pharma indices were the top gainers, each climbing over 3% last week.
Technically, despite various challenges in recent months, the market has maintained a Dow Theory buy setup, absorbing all global negative developments and major events. The current chart setup shows no significant overbought signs, though the RSI has hit the 70 line. The daily candle formed on the Nifty index was a small, low-range, low-volatility doji. On Friday, the markets opened with a gap up and remained there throughout the day. However, the weekly and monthly charts suggest that the momentum and trend are likely to continue. The Nifty could gradually test the 25,500 level in the near term. Since the markets are sustaining well above the 25,000 level, keeping the long-term trend intact and higher, a pullback of 1-2% is quite possible at any time, so be prepared for it. This will provide a buying opportunity. Immediate support is now seen around the 25,000 psychological mark, while the base stands at 24,850.
Sector Update: Both the IT and Pharma sectors look quite positive, with more upside potential. The Nifty Bank is catching up, but real momentum in this sector is yet to set in.
International indices are quite strong, with the Dow potentially testing new highs with momentum.
To conclude: The index is on its journey towards 25,500.
Levels:
Nifty
Bank Nifty
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