Despite the volatility in mid and smallcap space, Nifty has managed to hold on and has continued to register new highs.

The index continues to be in an uptrend so one should continue to trade with a positive bias and avoid taking any contra trades until any reversal is seen.

The only concern that we have been highlighting is the banking index which has been underperforming for so long.

This index is still in a consolidation phase and has not breached its important supports. Hence, there is a good probability of some buying interest emerging in this sector which would then result in further support to the benchmark.

The immediate supports for Nifty are placed around 16,600 and 16,500 while the levels to watch on the upside will be 16,800 and then 17,000.

One should keep track of the global developments and also book timely profits in trading positions.