Nifty commenced the week on a positive note and hit an all time high of 6776 in Thursday’s opening trade but profit booking at higher level saw the indices gave up all its weekly gains and close flat for the week.

The 30 share S&P BSE Sensex closed flat at 22359 up marginally by 19 points or 0.10% while NSE Nifty settled at 6694, down by 01 points or -0.02%.

Amid Nifty constituents, Cipla, HDFC, Hindalco, Jindal Steel and Power, Mahindra & Mahindra, Lupin, Tata Steel and Reliance Industries were top gainers while BHEL, GAIL, Tata Power, Axis Bank, Kotak Bank and ITC were top draggers.

Week ahead, Nifty on the weekly time frame has formed a High wave candle suggesting pause after the recent strong rally. Index traded in a 110 points range with high volatility during previous week and continued to form higher peaks and higher trough in weekly chart.

The high volatility in the last few sessions is on expected lines as the index is poised near its short-term target of 6750-6800.

The strong rally of over 700 points in the last seven weeks has stretched the daily momentum indicators into the highly overbought zone. Therefore, on technical grounds, it is being believed the index is due for a breather after achieving the measuring implication of the four month range breakout (6355 to 5933).

The index is likely to consolidate its recent gains and make a base for the next up move amid gradual profit bookings to allow the momentum oscillators to cool off while the stock specific activity is likely to continue in the coming week.

Nifty has immediate support at previous week low of 6662. The Index has managed to hold above its previous week low in the last eight weeks.

Therefore, only a break and close below (6662) will indicate a breather in the current uptrend and pave the way for profit bookings towards 6570-6550 levels being the recent breakout area of the mid-March 2014 consolidation.