Week Ahead

The benchmark share indices hit one-month high during the week ended July 8. The BSE Sensex rallied 1,574 points to 54,482, while the Nifty50 climbed 468 points to 16,221, the highest closing level since June 9, continuing uptrend for third consecutive week.The broader markets also joined the rally with the Nifty Midcap 100 and Smallcap 100 indices gaining 4 percent and 3 percent respectively.

The last three weeks of the rebound have certainly eased some pressure but cues are still mixed, which continue to trigger erratic swings in between. Apart from the US recession worries, participants should brace themselves for volatility owing to the earnings.

The June 2022 quarter earnings season will be in full swing in the coming week with around 70 companies releasing their numbers including prominent ones like HCL Technologies, HDFC Bank, ACC, Mindtree, Larsen & Toubro Infotech, Jindal Steel & Power, Tata Elxsi and Tata Metaliks.

Technically Nifty50 has seen a formation of bearish candlestick pattern which resembles somewhat Hanging Man kind of pattern on the daily charts, while on the weekly scale, there was a strong bullish candlestick formation, which resembles somewhat Bullish Engulf kind of pattern formation, raising hope for the further uptrend in coming sessions.

We largely expect the next hurdle for the index at 16,300 followed by 16,500 if it sustains above 16,200, with major support at 16,000 mark. Even oscillators RSI (relative strength index) and Stochastic indicated that the sentiments are positive.