Nifty started the week on a positive note and gained from strength to strength as the week progressed as it closed in green in four out of the five trading sessions during previous week. Buying was witnessed across the board as all major sectoral indices ended in the green and the broader market indices viz. BSE Midcap and small cap outperformed the benchmark indices with gains of 3.7% and 4.9% respectively.

The 30 share S&P BSE Sensex closed up by 862 points or 3.43% at 25962.06, while the NSE Nifty settled at 7751.60, up by 242 points or 3.23%. Amid Nifty constituents Auto, Capital Goods, Banking, Metals, Power, Oil & Gas, PSU and Healthcare stocks were major gainers.

Nifty formed a strong bullish candle in the weekly time frame and closed near the high of the week. It steered past its previous high of 7700 and closed at a new life high of 7751. The strong rally during the week has confirmed a higher bottom in place at last week’s low of 7441 signalling continuance of the primary uptrend. Further, the index posted a faster retracement of the last three week’s corrective price action as it completely overhauled a 13 session decline in just three trading sessions.

The slower pace of decline and faster pace of the rally clearly highlights the underlying strength in the trend. Bullish gap area of previous Wednesday (7634-7677) is likely to act as support in the coming week.

It has been expected that index to remain on course for upsides towards 8100 in the near term. It has been observed that since February 2014, each major rising segment has measured around 900 points.

The current up leg, which resumed from the lows of 7218, is expected to trigger a similar magnitude of the rally leading to upside towards 8100 (7218+900 = 8118) in the near term.