Chart check: NIFTY50 struggles, while NIFTY Midcap 100 and Smallcap 100 inch towards record highs

Domestic equity indices maintained their gains and were trading higher by over half percent in late morning deals as market participants indulged in enlarging their positions. Positive cues from the global markets supported domestic sentiments. Market sentiment remained upbeat despite the seasonally adjusted HSBC India Manufacturing Purchasing Managers’ Index (PMI) falling to 54.2 in June from 55.0 in May.

The benchmark indices closed the previous month with gains across the board. NIFTY50 gained 1.3%, and SENSEX rose 2.2% in June. Meanwhile, NIFTY Microcap 250 gained 6.3%, the most amongst broader indices, followed by NIFTY Smallcap 100 at 3.9%; NIFTY Midcap remained flat with 0.12% gains.

Here is what monthly charts indicate after a smart recovery from lower levels.

NIFTY50

The benchmark index closed the previous month with over 1.3% gains for June. However, the index failed to close above the 24,000 level for the fourth consecutive month. The monthly charts show that the index continues to face resistance at the monthly 20 EMA level of 24,062. The charts also indicate that a monthly closing above these levels would only revive the bullish momentum in the index. On the other hand, the swing low level of 22,200 remains a crucial support in the long term.

NIFTY Midcap 100

The Midcap 100 has outperformed its broader and large peer indices by hitting fresh record highs in June at the 62,909 level. However, due to the absence of fresh buying power at higher levels, the index has consolidated in the range of 59,500 to 62,200 levels for two consecutive months. At lower levels, the index continued to witness buying power, lifting the index near record high levels. The downside remains protected at the monthly 20-EMA level of 57,336.

NIFTY Smallcap 100

The NIFTY Smallcap 100 has extended its gains made in April, when the index rose over 18.4% in the month. In June, the index rose nearly 4%, inching closer towards the record-high levels. The index is roughly 4% away from record high levels of 19,716. On the technical charts, the index holds support at the 17,418 level of the monthly 20-EMA. Similar to the midcap index, the smallcap index also witnesses the absence of fresh buying power, halting its further rally.