Nifty Analysis, Outlook and Trend for 17th Jul 2019

Medium Term Trend:  ↓ Down (Up above 12010)

Bounced Back Strongly: Nifty opened in the familiar territory , just below 11600 and after spending some time there it bounced to 11630-640 levels and after threatening to fall from 11640 levels( Like it had done on Friday) it took another leap to 11670 levels and closed at 11660 ( up around 75 points).

In previous post we had mentioned  "if one is short in the market then he needs to be careful as a counter move by bulls can not be ruled out. Short positions are recommended once 11460 levels is taken out ". Now we couldn't have been more explicit than that. Nifty was spending too much time just below its crucial support which had raised the doubt if 11610-640 would be able to contain markets. There were many traders who have been going short around 11550-11600 levels assuming upside is capped at 11640 levels.

Even though Nifty now has crossed above 11640 levels, We are not recommending that one should go long now. Make no mistake about it, markets remains in a downtrend (for medium term) and it needs to do a lot more before we can assume that uptrend has resumed.

Market breadth today was on positive side with 38 advancing against 12 declining. Next few days trading is extremely crucial as it may decide the next trending move of the market (we have been saying that markets are ready for a big trending move on the either side and there is no change in our view even now).

Below is the snapshopt of messages/trade we did in last few days, if you wish to join us for live market updates during trading hours then you may do that using below link.
https://niftywaveindia.blogspot.com/2019/02/join-us-on-whatsapp-how-to-subscribe.html

08/07/2019, 09:23 - NIFTYWAVEINDIA.BLOGSPOT: Nifty 11700 sell 4 parts
08/07/2019, 10:57 - NIFTYWAVEINDIA.BLOGSPOT: Nifty 11650,  hold all shorts for now. Reversal has been very sharp so in all probability we r going below 11600 levels now.
08/07/2019, 13:07 - NIFTYWAVEINDIA.BLOGSPOT: nifty 11588 exit 2 parts short book profit
08/07/2019, 13:08 - NIFTYWAVEINDIA.BLOGSPOT: Hold balance 2 shorts
08/07/2019, 14:20 - NIFTYWAVEINDIA.BLOGSPOT: Nifty 11544 hold 2 parts shorts. Margin call trigger likely in last hour
08/07/2019, 15:20 - NIFTYWAVEINDIA.BLOGSPOT: Nifty 11565,carry both parts shorts for tomorrow

09/07/2019, 09:16 - NIFTYWAVEINDIA.BLOGSPOT: Good morning, nifty 11482
09/07/2019, 09:17 - NIFTYWAVEINDIA.BLOGSPOT: Hold both parts short for now. Less risky traders can book some more profits
09/07/2019, 09:19 - NIFTYWAVEINDIA.BLOGSPOT: Mkts r oversold so a pullback cannot be ruled out
09/07/2019, 10:52 - NIFTYWAVEINDIA.BLOGSPOT: nifty 11484 cover one more part book profit
09/07/2019, 10:52 - NIFTYWAVEINDIA.BLOGSPOT: Hold just one part short (min qty)
09/07/2019, 15:20 - NIFTYWAVEINDIA.BLOGSPOT: Nifty closing flat. Carry one remaining short for tomorrow

10/07/2019, 09:17 - NIFTYWAVEINDIA.BLOGSPOT: Good morning, nifty CMP 11553 sell 1 part
10/07/2019, 09:17 - NIFTYWAVEINDIA.BLOGSPOT: Hold 2 parts short
10/07/2019, 09:38 - NIFTYWAVEINDIA.BLOGSPOT: nifty 11570 :sell 2 more parts
10/07/2019, 09:38 - NIFTYWAVEINDIA.BLOGSPOT: Hold all 4 parts shorts
10/07/2019, 12:57 - NIFTYWAVEINDIA.BLOGSPOT: nifty 11482 exit 2 parts book profit
10/07/2019, 12:57 - NIFTYWAVEINDIA.BLOGSPOT: Hold balance 2 shorts
10/07/2019, 15:24 - NIFTYWAVEINDIA.BLOGSPOT: Nifty 11490. Carry balance 2 parts shorts for tomorrow

11/07/2019, 09:26 - NIFTYWAVEINDIA.BLOGSPOT: Good morning, nifty trading around 11530. Hold both shorts for now
11/07/2019, 15:10 - NIFTYWAVEINDIA.BLOGSPOT: nifty 11585 exit 2 parts bal short
11/07/2019, 15:10 - NIFTYWAVEINDIA.BLOGSPOT: Position Nil
11/07/2019, 16:04 - NIFTYWAVEINDIA.BLOGSPOT: <Media omitted>
11/07/2019, 16:06 - NIFTYWAVEINDIA.BLOGSPOT: Mkt has defended an imp trend line for 3rd day in a row plus crucial 11525 has been defended again (day low was 11520) will enter shorts again only once the weakness resurfaces


Happy Trading!!







 

Nifty Analysis, Outlook and Trend for 16th Jul 2019

Medium Term Trend:  ↓ Down (Up above 12010)

Flirting with 11600: Nifty opened around 11600 but failed to cross above it. It even fell to 11530 levels but recovered later and closed at 11590 levels up 36 points.

Nifty continues to flirt with 11610-640 levels but is not able to cross it neither its seeing any substantial selloff from these levels. Last week we had mentioned that 11600 was an important support and once it broke same is likely to act as a resistance  however whenever market break some important support /resistance level it usually sees a big movement in the direction of break ( like the rally we saw once 11K level was taken out by market earlier this year). Now its been 6 days but mkts are still sitting around 11600 and this is something which should be given importance. Its totally possible that markets are just consolidating sideways before it  opens another leg down but the fact is that consolidation is taking place at levels which is too close to its previous support. Under the current circumstance if one is short in the market then he needs to be careful as a counter move by bulls can not be ruled out. Short positions are recommended once 11460 levels is taken out by in which case we are probably heading to 11300-350 levels.

Overall market continue to be in a downtrend and need a move above 11640 and then above 11750-800 levels in which case the probability of Nifty testing 12K+ levels once again will become strong.

Happy Trading!
 

Nifty Analysis, Outlook and Trend for 15th Jul 2019

Medium Term Trend:  ↓ Down (Up above 12010)

Trades Flat: Nifty opened around 11600 today and went on to touch 11640 but soon selling emerged at 11640 levels and pushed Nifty all the way back to 11540 levels and markets closed down 30 points at 11552.

As we have been mentioning that Nifty has good resistance in 11610-640 zone and Nifty needs to conquer this level in case it wants to resume uptrend. Todays the high touched by Nifty was 11639.5, this in itself explains the importance of levels mentioned by us.

Today markets may have crashed 100 points from day high but inspite of that Nifty has a higher high and higher low on daily charts ( and Nifty is doing that for last 3 days). Yesterday we had mentioned the importance of 11500 zone and even today the same view stands. Incase markets wants to push from here then it needs to hold 11500-525 levels, further weakness below this level can push nifty all the way back to 11350-400 levels.

Another thing we mentioned yesterday that Nifty OI was pretty light at 1.75 crores, now the same has further reduced to just 1.69 this is extremely low. Historically we have witnessed that markets find difficult to fall much when its trading light. Perfect example is just before exit poll result, we had mentioned same thing even then (when nifty was around 11100 levels) and everyone saw what happened after that. Now we are not saying markets cannot fall from here, it can easily fall by another 200-300 points but the point is blind shorting at this stage is not recommended and one should be prepared for a counter trend by bulls at all time.

Today the fall from 11640 was pretty sharp and there is chance that markets tempted Bears to enter into fresh short positions towards the close of play. However if markets continue to fall and break below 11500 levels then it would be a different scenario altogether.

Another thing which must be given importance is that 11600 was an important support and whenever markets break some important support and resistance , the move which comes is usually big. Take the example of 11K levels, earlier this year markets were repeatedly coming down from 11K levels and finally when this level was crossed in March, we saw a big rally which pushed Nifty all the way to 11800 levels. Now its been 5 days already since 11600 was broken and market is still sitting near 11600 levels (just below). If support is already taken out then why its not moving down in a big way? was it a false break? could be possible or probably markets just digesting the previous fall 11990-11460 (which was big too) and once this sideways movement or digestion is over, markets will open another leg down. Just a food for thought!

Happy Trading!!

Nifty Analysis, Outlook and Trend for 12th Jul 2019

Medium Term Trend:  ↓ Down (Up above 12103)

Market Bounces: Nifty opened around 11550 levels and dropped to 11520 levels immediately after opening however it kept inching up through out the day and closed near the high point of the day @ 11583 levels up 85 points.

We had mentioned in previous post that Nifty need to take out 11610-640 levels for the resumption of uptrend and if market sustains below 11500-525 levels then it can further slip to 11400 levels. Markets did neither, though it had closed at 11500 yesterday, today there was no followup selling below 11500 infact Nifty opened strong and bounced back from 11525 levels which tells us that 11500 level continue to remain important for now.

There is no doubt that market is in a downtrend and the way it has fallen from 11900 levels is indeed looking like a fresh down trend. However there are few things which are suggesting that 11500 is going to be a critical level to watch out for (and there are more than one possibility indicating the same)



Nifty daily chart

• 1148-500 is exactly touching the channel bottom. This channel supported markets at 10600 and then at 11100 & now the same stands at 11500
• Gap area @ 11400-11691 still stands. Though Nifty has entered the gap area, it has not managed to fill it fully. So for now it will be considered that markets are trading in support zone
• 11480 is also the 61.8% retracement level of entire rise from 11100 to 12103

Now I am not saying that markets are done with correction, but all I am saying is that this is an important area to watch out for. Its entirely possible that markets are just respecting this area and after spending some time here (in consolidation) it will open another leg down. Hence sign of strengths or weakness for that matter should be observed carefully around these levels ( it is possible that markets take a big swing from here)

Another important thing to note is that Nifty lost a huge 10 lac shares in OI today, Now losing OI on a day when markets have given a strong rally is indicative of short covering, so there is a high chance that todays rally was just because of short coverings. However the impact of fall in OI is that markets have once again become very light ( 1.75 crore). We have seen repeatedly in past that whenever markets are light they fail to move down for an extended period of time.

Overall, market remains in a downtrend and a sustained move below 11500-480 levels could invite further selling and Nifty is likely to drop to 11350-400 levels on the other hand strength above 11610 levels could probably extend the bounce we saw today, so trade accordingly.

Happy Trading!!





 

Nifty Analysis, Outlook and Trend for 11th Jul 2019

Medium Term Trend:  ↓ Down (Up above 12103)

Weakness Continues: Nifty opened flat and tried to cross 11600 levels but met with a strong resistance and pushed back to 11500 levels. It made a low of around 11480 and closed at 11499. Down 60 points.

11600 was the previous support and today same acted as a resistance. We had mentioned yesterday that 11610-11640 is the key level to watch for short term and markets must trade over it in case it wants to resume the uptrend. We had also mentioning that 11500-525 is another key level below which markets can slip to 11400 levels. well today market failed to cross 11600 and have closed below 11525 levels. If Nifty sustains below this level for some more time then it can further fall to 11400 ( and even lower levels around 11350).

For now Nifty seems under pressure and it seems market is not liking the additional tax imposed on FPI and same is keeping the selling pressure on for now. Having said this, the markets always move where they want to move and such news/event driven move never last long.

PCR is trading below 1 and it is the first time in last few months that PCR has fallen below 1 suggesting that selling pressure is likely to continue for now.

So nothing much to add today, most of the things remains same as yesterday and now that we have made one closing below 11525 levels. Needs to see if the market sustains below this level and if that happens then the chances are that lower levels around 11400-350 can be tested pretty soon.

Happy Trading!

Nifty Analysis, Outlook and Trend for 10th Jul 2019

Medium Term Trend:  ↓ Down (Up above 12103)

Flat day: Nifty again opened with a gap down below 11500 levels and it went on to touch 11460 levels before some support emerged and it closed flat at 11550 levels.

Yesterday we had mentioned that the way Nifty has fallen, it has probably opened the gateway for much lower levels and for any chance of positive scenario to emerge Nifty needs to to defend 11525 levels. Though 11525 was breached intraday , Nifty somehow has managed to give a closing above it however it will be too early to say if Nifty has found the support it was looking for. After a strong fall yesterday market had become oversold on the short term charts. Todays lift from lower levels has somehow pulled nifty back from oversold zone.

Going forward 11610-640 will be a key level to watch out for form short term perspective. This level had acted as a rock solid support in last few weeks and the chances are same will be acting as a stiff resistance going forward. If nifty manages to cross 11640 levels then 11730-800 becomes another critical level/rage ( Mondays gap down).

There is a view in the market that the entire move after exit poll day till last week ( 11400-11980) was a 'distribution pattern' and smart money has used this opportunity to offload their holding on to weaker hands. All 'distribution' patterns after completion usually sees a very strong fall and since we saw a strong fall yesterday (that too a gap down) there is  a very strong possibility that it was indeed a distribution by strong hands. However there is another possibility which suggests that the entire flattish move we saw was just an 'accumulation'. If that is the case then we should see another move up pretty soon. For now the chances of this being a 'distribution' looks strong however one cannot say with surety but if that's true then Nifty will probably break below 11400 levels and fill the entire gap ( for now the gap still stands).

For now, like we said yesterday, keep an eye on 11610-630 levels and above that 11800 (Nifty needs to overcome 11800 levels if it wants to resume the uptrend else the weakness might continue and Nifty will keep on falling and testing lower levels. for bulls , its important that Nifty holds on to 11525 level on closing basis any weakness below 11500 levels could push Nifty back to 11400 levels and below that 11100 levels.

Happy Trading!



 

Nifty Analysis, Outlook and Trend for 9th Jul 2019

Medium Term Trend:  ↓ Down (Up above 12103)

Black Monday: Nifty opened with a huge gap down at 11720 levels and didn't lookup after that. It crashed to a low of 11523 and closed at 11564 levels, a whopping 250 points down.

Market showed weakness all around and there was no place to hide for anystock or sector. In previous posts we had mentioned that there is a possibility of upmove sustaining if 11760-11800 is sustained but if 11750 is taken out then we are heading straight to 11650 and below that 11500 levels ( as 11650 was our medium term support level). Nifty broke down all levels in one day and in one go.

When Nifty gave a gap down opening below 11750 levels it was a clear sign that it wants to go below 11600 levels in hurry. We had also mentioned few positive factors which suggested a possible support at 11800 levels however everything was negated at 9.16am when Nifty opened below 11750.

Such a big swinging move was expected on both sides since last few days and now that it has come on the downside chances are that gateway to much lower levels have been opened. Nifty had a huge gapup in the range of 11400-11600 levels and today it has dropped below 11600 and now trading in the gap zone which it was protecting till now. Incidentally, market has now broken the election day low ( 11614) as well ( election day high still sustains and market has failed to trade above it for more than a session). This is indeed a  big bearish sign.

Now going forward, 11500-525 assumes a lot of significance as sustained trading below this would push Nifty back to 11400 (lowest end of this gap) and once 11400 is taken out then another wave of down move can be expected. For now, due to the huge fall we have witnessed today, the market has become oversold so some bit of consolidation and pullback can not be ruled out. To resume uptrend Nifty needs to reclaim 11825 levels. Only once we start trading above 11825 can we hope for a fresh up move now.Nifty has a big resistance in 11625-11675 zone now. This area was continuously providing support to Nifty since last few weeks but has been taken out in one swift action.

To summarise, as soon as Nifty opened below 11750 today, it moved in bear zone. Now unless 11690 and 11825 is taken out there is every possibility of Nifty falling even more from here. From positive perspective, 11523 level ( which is the 38.2% retracement level of entire rise from 10583 to 12103) should offer some support and if Nifty manages to protect this level ( todays low) then there is some chance of Markets clawing its way back again.

Happy Trading!