Upward momentum could continue

The market closed marginally higher on Monday with heavyweights like Tata Motors, TCS and HDFC Bank making strong gains. Sensex closing at 38905, up 138.73 points or by 0.36 per cent while the Nifty ended 46.9 points higher at 11690.

The Market breadth, indicating the overall strength of the market, was strong. On BSE out of total shares traded 2,980, shares advanced were 1,543, while 1,219 shares declined and 218 were unchanged. Overall 24 stocks closed among the Sensex pack, while 37 stocks closed in the green out of the 50 stocks on the Nifty.

Both Mid-Cap and Small-Cap indices also gained as buying emerged in the broad market.

Technical View
The F&O market saw good amount of fresh longs positions in both Nifty as well as BankNifty. According to analysts there were good amount of put option writing in 11600-11700 range.

On the other side, 11700-11900 call options added decent position along with unwinding in 11600 strike. Last week, we saw some consolidation which was mainly due to profit booking and no shorts were visible. "If we glance at the historical data, we shall observe that decent amount of longs are still intact in the system. Now, we are again seeing some buying interest from the support zone of 11550-11600. Thus, traders are advised holding their existing longs as we are soon heading above the record highs," said Sneha Seth, Derivatives Analyst, Angel Broking.

"Nifty closed in the positive territory in the last trading session and it has closed in the favor of bulls for the third consecutive day. The stock has been forming higher tops and higher bottoms with a buy crossover in its momentum indicator. The minimum target on the upside comes to 11795 whereas the support is pegged at 11619," said Jay Thakkar, CMT Head Technical and Derivatives Research - AVP Equity Research, Anand Rathi Shares and Stock Brokers.

Market View
Analysts said the markets started off well after US markets witnessing a strong upsurge on Friday's session. The entire Asian basket too had a good run in the morning; however most of these bourses later on giving up their gains.

Despite this, we managed to hold our ground and had a gradual up move throughout the remaining part to conclude firmly well inside the positive territory.

"Technically speaking, we have now broken out from the recent 'Falling wedge' pattern which is visible on hourly chart. However, the momentum was lacking as we are heading into a truncated week. With today's move, we are now clearly continuing our march towards the higher end of the range i.e. 11761; in fact we will not be surprised to see it surpassing soon. Thus, we maintain our optimistic bias and advice traders not to adopt a contrarian approach. On the flipside, 11663 followed by 11629 would now be seen as immediate support levels, said Sameet Chavan, Chief Analyst-Technical and Derivatives, Angel Broking.

"We had a healthy market breadth throughout the day and we expect this stock specific theme to continue for next few days. Traders are advised to keep focusing on individual stocks that are gearing up for strong moves," he further said.