11150 zone likely to act as near-term support

The market made massive gains after the government cut the corporate tax rate to boost economic growth. The rally was led by banks and auto stocks. The Sensex rose 1921.15 points or 5.32 per cent to 38014.62, the Nifty rose 569.40 points or 5.32 per cent to 11274.20. On the BSE, 1864 shares rose and 728 shares fell.

The rally was broad based with Mid-Cap Index rose 6.28 per cent and the Small-Cap Index rose 3.94 per cent.

"We observe an upside breakout as per weekly timeframe chart, after the consolidation movement of the last one month. The near term trend of the Nifty seems to have reversed up sharply and more upside could be in store in the coming weeks. Having reached the swing high of 11381 in Friday's session, one may expect next upside targets of 11600 for the next 1-2 weeks, said Nagaraj Shetti — Technical & Derivative Analyst, HDFC Securities.

The Nifty Bank surged over 8.27 per cent, while the Auto Index also rose 9.82 per cent. "Technically, the market has broken major resistance at 11200 and closed above on weekly basis. It was consolidating between 11150 and 10650 since last one and half month and Friday's break out pattern would lift Nifty to 11600 in next few months," Shrikant S. Chouhan, Senior Vice-President, Equity Technical Research, Kotak Securities said.

According to analysts, the dips should be utilized because some big move is seen in volume which has overall participation i.e across the board, be it any sector.

Technical View
"Nifty had a stellar move upwards after the boost from the FM on "TAX CUT". The range we mentioned was protected on the downside. Time and again we have been mentioning about 11300-11500 zone to be tested on the upside. We continue with the bullish view and the upper end of the range is likely to get tested. Expect broader markets to witness sustainable up move. 11150 zone is likely to act as near term support," said Manav Chopra, CMT, Head Research — Equity, Indiabulls.

Market View
"The announcements came just in time as markets were reeling under tremendous pressure, citing weak domestic sentiments and not so encouraging global markets. On the benchmark front, the Nifty should hold above 11250 to carry this momentum else profit-taking may resume. We suggest being selective at current levels as participation would restrict largely to the quality names," said Ajit Mishra Vice President, Research, Religare.