Short-term trend stays positive

The market closed higher on Wednesday after a volatile trading session, with the Sensex gaining 217 to close at 37,752 points on the back of buying in financials and energy stocks. The Nifty closed at 11,341, up 41 points as blue-chips like IndusInd Bank, Yes Bank, Reliance and Axis Bank helped the index to close higher.

The broader market also saw buying interest with the BSE Mid-Cap and Small-Cap indices ending in the green.

The global factors like the Brexit woes caused volatility in the market but the positive domestic cues supported the indices.

Domestic inflation continue to undershoot RBIs target level while weak industrial growth increased the prospects for further action from RBI. On the global front, the defeat of Theresa May's latest version of Brexit deal is creating uncertainties in UK's economic growth while haven asset like gold inched higher, analysts said.

Technical View

After showing a sharp upmove in the last couple of sessions, the Nifty shifted into consolidation today as it closed with modest gains.

"A small body positive candle has been formed today with long lower shadow. Technically, this formation indicates a hanging man type pattern. Normally, the hanging man patterns signal word of caution for long positions at the highs. But, confirmation of weakness is required to call this as a reversal, said Nagraj Shetti, Senior Technical & Derivative Analyst, HDFC Securities.

"Hence, the short-term trend of the Nifty continues to be positive. Next upside resistance to be watched at 11,450 levels,” he further said.

Some experts feel that the Nifty has given a strong breakout and is expected to remain strong going ahead. The broad based participation is seen which is supportive of the positive outlook.