Nifty closes at record high of 13,682; HDFC Securities says upside levels to be watched around 13900-14000 in next 1-2 weeks

Indian equity benchmark indices broke out of a three day sideways move to close near the highest point of the day today making another record high. The Nifty opened gap up and post making an intraday low at 1300 Hrs, rose again to close near the intraday high. At close the NSE Nifty 50 index rose 0.85% to end at 13,682.
 
Among sectors, Realty, Metals, Auto and Pharma were the main gainers while PSU Banks were the main loser. Broad market indices i.e. small cap and midcap indices rose more than the Nifty.
 
World stocks rose to record highs on Wednesday while the safe-haven dollar reached its lowest in more than two and a half years on the prospect of effective coronavirus vaccines and more U.S. fiscal stimulus.
 
Markets will look to the U.S. Federal Reserve later to see whether it hints at an extension of its stimulus programme and it thinks the economy will suffer a double-dip recession or is on the cusp of a vaccine-inspired boom.
 
European stocks and the euro also got a boost after PMI economic data (Eurozone PMI at 49.8 in December vs 45.3 in November) came in better than expected and the European Central Bank decided today to let eurozone banks start paying dividends again if they have enough capital.
 
Nifty continues its uptrend with a series of upgaps which are yet to be filled. This shows the strength of the current upmove and also indicates that whenever the correction starts all the recent upgaps may have to be filled. 13800-13900 is the cluster resistance zone for the Nifty. 
 
After showing consolidation type movement in the last four sessions, Nifty shifted into an upside breakout of 13600 levels on Wednesday and closed the day higher by 114 points. After opening on a positive note, the market moved into a narrow high low intraday range till the mid part of the session. Further upside has occurred in the mid to later part and Nifty closed near the highs. The opening upside gap remains unfilled.
 
A small positive candle was formed with a long lower shadow. Nifty closed above the last four sessions upper range of 11590 levels. Technically, this pattern indicate an upside breakout of the small range at 13600. The overall market breadth was positive and broad market indices like midcap 100 and small cap 100 of NSE exchange have closed higher by 1.15% and 1.05% respectively. This is a positive indication.
 
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After the upside breakout of the resistance of the top to top trend line at 12900 levels in the later part of Nov 20, Nifty displayed strength at the new highs and sustained the higher levels. Hence, the trend line upside breakout could be considered as a valid upside breakout and the positive implication is underway since then.
 
Conclusion: The short term trend of Nifty is positive and one may expect further up moves in the coming sessions. The next upside levels to be watched around 13900-14000 in the next 1-2 weeks. Immediate support is now placed at 13580.