Chartist Talks: Sudeep Shah of SBI Securities explains why Balkrishna Industries, Zydus Life hold bullish structure

About this update from Balkrishna Industries Limited

India VIX, the fear index, has rising significantly in the past few sessions (from 10.93 to 20.53 levels). But, "a rising VIX on its own, particularly during the current election period, may not necessarily lead to a sharp correction in the Indian markets," Sudeep Shah of SBI Securities said.According to him, the significant trouble is more likely if a rising VIX coincides with weakness in global markets.Technical factors indicate strong bullish momentum in Balkrishna Industries, and Zydus Lifesciences, said the deputy vice-president and head of the technical and derivative research desk at SBI Securities, who has more than 15 years in technical and derivatives research.Do you get the confirmation for Nifty moving towards record high in coming days, though the volatility remains elevated at around 20?Over the past week, the Nifty has shown significant volatility, with the India VIX rising to the 20-21 range and potentially climbing higher. Historically, since 2011, there have been nine instances when the India VIX traded between 20 and 40. In six of those instances, the Nifty corrected by 10-15 percent, while in the remaining three, it gained by 12-20 percent. Notably, two of the three instances where the index gained despite a rising VIX occurred during the election periods of 2014 and 2019, coinciding with positive momentum in global markets.Therefore, a rising VIX on its own, particularly during the current election period, may not necessarily lead to a sharp correction in the Indian markets. Significant trouble is more likely if a rising VIX coincides with weakness in global markets.Coming to the Nifty, post a retest of 21,825 zone, index has shifted gears and started its rebound journey, finally ending the week (ended May 18) above 22,500 mark with the gain of over 2 percent. On a weekly scale, it has formed sizeable bullish candle.Currently, the index is trading above its short and long-term moving averages. The daily RSI (relative strength index) has given a breakout of a Falling Wedge pattern and is about to cross the 60 mark, indicating strengthening momentum. Additionally, all the other indicators and oscillators indicate strength, and hence, we expect the current positive momentum to continue.Going ahead, the 20-day EMA (exponential moving average) zone of 22,300-22,200 will serve as crucial support for the index as the index has sustained abov...

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