Nifty Outlook and Trend for 3rd Jun 2019

Medium Term Trend:  ↑UP (down below 11400)

Day of Choppiness: Nifty opened strong at 12K levels and went to touch its previous high of 12040 ( Sensex even registered a new high) and turned back very sharply. Move down was so sharp that Nifty was almost 200 point down from its day high in a matter of mins. Nifty finally managed to regain some lost ground and closed at 11920 levels, down 25 points.

First half was really action packed  with Nifty swinging wildly. It broke above 11975 levels ( even though it could not sustain) hence the possibility of extracting triangle pattern stands negated. However the 'dragonfly doji' market has posted on Tuesday still stands. Nifty needed a close above 11960 levels which it failed to do so.

Since last few days we have been saying that even though we are bullish on markets, we remain cautious at current levels. Its not a market where you can go and buy on breakouts ( todays move justified our stance). If some one had gone long this morning thinking market has broken through about 12K was in or a rude shock moments later. So trend is up no doubt, but there is a chance of markets going for a correction ( big or small). From here now it remains to be seen if the fall we saw today was just a intraday phenomenon or it continues going forward too.

We continue to be cautious at current levels for various reasons. firstly , the election euphoria is still there in market with everyone turning super bullish at current levels. Secondly, we are seeing some negative divergences on charts which is not supporting this upmove ( divergence is not strong but it does exists) and finally even on monthly charts Nifty has formed a 'Hanging man' kind of pattern which again can have some bearish implications as we move forward. Now it doesn't mean that we are bearish on markets ( not yet) however we are merely acknowledging that there is a possibility of sideways movement or some cooling off in the indices in near term.

On the daily charts it seems as if entire move from low of 11100 has completed five wave upmove ( 1-2-3-4-5) however its too early to say ( need more evidence to confirm that). Further weakness from here below 11800-820 levels will be a sign of correction setting up in the markets and fast move up above 12040 levels will set the ball rolling again in favor of bulls.

We keep guiding and advising our subscribers through regular intraday whatsapp updates as to what needs to be done, when & where to enter during trading hours. If you wish to subscribe to our live whatsapp Nifty calls/trading recommendation then you may subscribe using below link:

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Nifty Outlook and Trend for 31st May 2019

Medium Term Trend:  ↑UP (down below 11400)

Consolidation continues: Nifty Opened flat (inspite of a strong overnight fall in US stocks) but kept marching up for the entire day. There was no volatility and markets closed at 11945 ( up 85 points).

 

Nifty continues to consolidate and still remains in a tight range. On the election day result the high hit by Nifty was 12040 and low 11614, now even after almost a week, the high and lows hit by markets on that day hasn't been breached. I think this tight range bound trading is due to expiry related pressures. Before election results , the option premiums were pretty high and smart money probably has eaten up premiums on both sides ( a possibility we had mentioned long back before results came out).

 

Now that the expiry is out of the way, we should be seeing some movement (in either direction). Today inspite of a strong rally, markets have failed to cross the critical level of 11975 hence the possibility of extracting triangle ( which can have some bearish implications for short term) still stand. Also markets have still not been able to close above the 'dragonfly doji'  it made on Wednesday. This again is warranting some amount of caution at current levels.

 

Nothing much to update for now, caution is advised at current levels unless 11975-12K level is crossed and sustained on the downside one more (small or big) correction is possible from current levels. On the downside 11840 -820 is a crucial level now, if that is taken out markets can slip to 11700-650 levels once again but no danger to the current uptrend till the time 11400 holds.

  

We keep guiding and advising our subscribers through regular intraday whatsapp updates as to what needs to be done, when & where to enter during trading hours. If you wish to subscribe to our live whatsapp Nifty calls/trading recommendation then you may subscribe using below link:

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Happy Trading!

Nifty Outlook and Trend for 30th May 2019

Medium Term Trend:  ↑UP (down below 11400)

Downward bias: Nifty Opened slightly weak around 11900 levels and after consolidating around 11900 for most part of the day it dropped to around 11850 levels. Nifty finally closed at 11860 levels down 70 points.

We have been mentioning since last few days that  because of various factors ( huge OI at 12k calls , possibility of an extracting triangle & the dragonfly doji yesterday) caution is advised at current levels. Nifty needed to cross and sustain above 11975 levels which it failed to do & as a result market traded weak and has again moved and closed below 11875 levels ( which was the previous resistance level). Nifty has been able to give just 2 closing above 11875-11900 levels  (we needed atleast 3 close above 11900 as we had mentioned in our earlier post).Now the entire band of 11900-11975 is likely to offer strong resistance to Nifty. On the downside support exists at 11810 & 11750 levels.

Since Nifty has failed to cross 11975, the current rally still remains smaller than previous rally hence the possibility of extracting triangle is still open. Also today Nifty has made a lower bottom and lower top on daily chart and closed below the low point of yesterday ( below Doji low). Further weakness below todays low could mean sideways to down movement is likely to continue for now.

So for now we continue with same outlook. Nifty needs to cross above 11975 levels and failure to do so might cause some sideways movement or correction however the trend remains up as long as 11400 holds so Nifty has plenty of room to go down and still remain up overall.


we keep guiding and advising our subscribers through regular intraday whatsapp updates as to what needs to be done, when & where to enter during trading hours. If you wish to subscribe to our live whatsapp Nifty calls/trading recommendation then you may subscribe using below link:

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Happy Trading!

Nifty Outlook and Trend for 29th May 2019

Medium Term Trend:  ↑UP (down below 11400)

Market Consolidates: Nifty Opened today @ 11958 levels but immediately dropped to 11900 levels. It kept trading around 11900-920 levels through out the day and for a brief moment even dropped to 11875 levels but immediately recovered & closed flat at 11928 levels.

Yesterday we had mentioned that Nifty needs to cross 11970-975 levels to negate the 'extracting triangle pattern' . Those levels are still not crossed hence probability of 'extracting triangle' still remains (though it has weakened a little bit now).

On daily charts, Nifty today posted 'dragonfly doji'. A 'dragon fly' doji is a candlestick pattern where opening and closing rates are almost same but candle has a long lower shadow. Such pattern are also indicatives of probable exhaustion or trend reversal. Need a strong close above todays high to push market higher from here.

12K Call option continue to have open interest of around 4 million shares which is pretty huge ( and it seems most of these calls are written by smart money) hence for now markets are likely to be under pressure for couple of more days atleast. Even though overall trend of the market is bullish and 12500 level is likely in near future but if markets are not able to conquer 970-980 levels soon there is a probability that it sees one more fall before that happens.

Usually markets have a habit of  making tops on euphoric days and bottoms on panic days, 12040 top hit by markets on election result day still stands  even after 3 days. Now markets can go and make a new high tomorrow itself we are not disputing that, its entirely possible. All we are saying is that there is a chance of markets giving a little or big correction from here before that happens.

Any correction if comes, as long as it finishes above 11400 levels should not be a major cause of concern for bulls & should be an excellent buying opportunity only. We are bullish on the markets but with  a caution, its not a market where you can blindly buy at any level.For now keep watching 11975-12000 to 11800-825 range as break on either side will give us further clues about what markets intends to do in short term.

Happy Trading!

Nifty Outlook and Trend for 28th May 2019

Medium Term Trend:  ↑UP (down below 11400)

Another Strong Day: Nifty opened slightly weak at around 10830 levels but immediately started moving up. It hit a intraday high of 11957 & closed at 11925, up 75 points.

Nifty had a good resistance at 11875-11900 zone which it crossed today. We have had one successful close above 11900 zone need to see if Nifty can sustain above this level in the next couple of session as well. Sustaining above 11900 level will be a sign of strength however 11950-11975 is another very strong resistance zone. Nifty almost touched 11960 today so sustained trading above todays high is required to push Nifty higher.

In last post we had mentioned a possibility of a bearish extracting triangle which can have negative implications for short term. That possibility still stands and markets appears to be in E leg ( last leg) of extracting triangle. If you notice all directional legs ( i.e, A, C & E) the A leg measured around 750 points ( 11108 to 11850), C leg measured around 360 points ( 11680 to 12040) and E leg has measured around 343 ( 11614 to 11957) today. So as of today, the current leg remains smaller than previous leg. (Rallies are getting shorter and falls are getting bigger). This pattern will be negated once Nifty crosses 11970-11975 levels.

Also, 12K strike levels continue to have a massive buildup of OI in calls so probably Nifty will find it a bit tough to move above 12K before expiry atleast. Other than that, for medium term the trend remains up and will remain up as long as the gap we saw after exit poll results ( 11420-11600) is not filled.

In nutshell, market trend remains up but be careful & cautious in 11900-980 zone because of expiry related and other technical factors mentioned above.

Happy Trading!