Nifty Analysis, Outlook and Trend for 14th Aug 2019

Medium Term Trend: ↓ Down (Changes to Up above 11365)

Nifty Tumbles: Markets open flat and 11115 levels  but kept on getting weaker as the trading progressed throughout the day and gave up almost 200 points from day high. It finally closed at  10925 down 180 points.

 In the last couple of post we had mentioned the possibility of Nifty taking support at 10850 levels and moving higher. Nifty did take some support and even moved to 11181 but the upmove came to an abrupt end and Nifty tumbled back to 10900 levels. We had also mentioned that in case of downmove market should get some support at 10925-10950 levels and further fall is likely only below this trading range. Today markets has managed to close almost at the lower end of this support zone.

For tomorrow a slightly adjusted 10870-10900 zone becomes important now. If we see follow up weakness below 11900-870 levels and probably we can say that the move from 10800 to 11181 was a corrective move and same is over & the probability of Nifty making a new low below 10780 and then towards 10600 will increase further.

Market remains highly volatile and volatility may increase further in coming days. There is a chance that markets have formed some sort of bottom around 10780 levels ( provided 10870-900 holds) and if it holds then we can expect to see Nifty back again above 11K levels.

Happy Trading!

Nifty Analysis, Outlook and Trend for 13th Aug 2019

Medium Term Trend: ↓ Down (Changes to Up above 11365)

Bounce Continues: Nifty opened strong at 11100 and went to touch a high of 11175 some profit booking at the end pushed it back to 11100 and Nifty finally closed at 11110 (up 77 points).

We have been mentioning that though Nifty is week we can see a bounce from 10850 levels and we did see a strong bounce yesterday and it continued even today. Good thing about todays move is that it managed to cross 11125 and closed above 11100 which is indeed a positive sign for the bulls. Last week when Nifty broke below 10985 we had mentioned that even long term trend has been changed to down. Now usually whenever long term support is taken out the fall we see is vicious however in this case even though Nifty fell to 10770 the fall wasn't a big one and that is on of the reason we were suspecting a bounce from 10850 levels.

Yesterday we had mentioned that basis one day move its too early to conclude if the down move is over and Nifty has started another leg on the upside. However now that weekly close has come above 11100 levels, the probability of Nifty starting a fresh upmove from these levels has become slightly stronger. If Nifty can sustain 11100 levels in coming sessions then probably we can see testing of 11300-350 levels and once 11350 level is surpassed then this upside move will gain further momentum.

In summary, since the weekly close has come above 10985-11K zone, we are assuming that long term trend is intact ( inspite of couple of daily close below this level) and we further need to observe and see if this level is sustained and if it does then we are moving much higher from here however if weakness starts then 10925-10950 level should offer some very good support and if somehow it gets broken then we are looking at 10600 levels in near term. One thing is clear, we don't see any point of shorting this market at this point (as long as 10900 is intact).

Markets are likely to be volatile going forward and an intraday or overnight fall of  150-200 points can not be ruled out hence all SLs needs to be adjusted accordingly.

Happy Trading!









 

Nifty Analysis, Outlook and Trend for 9th Aug 2019

Medium Term Trend: ↓ Down (Changes to Up above 11365)

Strong Bounce Back: Nifty opened at 10900 levels and dropped to 10850 quickly but saw a strong support in the region which lifted markets all the way to 11050 ( more than 200+ rally). it finished strong at 11032 levels up 175 points.

Yesterday we had categorically mentioned that even though markets are in downtrend 10850 is the area from where we can expect a bounce and that's exactly what we witnessed today. There were quite a few technical factors indicating towards a possible bounce from these levels.

Now that the bounce has come and Nifty has moved back above 11K levels can we assume that downmove is over and markets are ready for an fresh upmove? answer to this question is yes it can but its too early to conclude anything. One day bounce amidst a strong downmove can not be conclusive. We need to see further strength above 11100 and 11125 levels to even start thinking about a fresh upmove. If Nifty can cross and sustain 11125 then we can probably see some more strength returning in the markets, on the other hand if markets fails to do that and break below 10925 levels then we are heading towards 10600 for sure.

In Nutshell, keep an eye on 11125 levels. Markets crossing and sustaining above 11125 will be a positive sign and on the downside 10950-925 should offer significant support for time being. If 10925 breaks then we are headed lower once again. If markets can manage to cross 11125 and 11360 after that then we can hope to see 12K levels once again.


Happy Trading

Nifty Analysis, Outlook and Trend for 8th Aug 2019

Medium Term Trend: ↓ Down (Changes to Up above 11365)

Weakness Again: Nifty opened flat but after trading around 10950 level for entire day it dropped below 10900 levels towards the end touched 10850. It closed down 90 points @ 10855.

Markets have been in a downward trajectory ever since it broke below 10985 levels and since then every rise is attracting selling. However on short term charts markets are appearing a tad oversold hence a bout of short covering can not be ruled out. 10800-850 is the area from where we can expect a bounce however further weakness below this level can push Nifty all the way to 10600 levels.

Since the day Nifty closed below 10985 levels, the long term trend  turned down and most likely  Nifty is headed towards 10600 which was the starting point of this entire rally ( 10583 to 12103). If Nifty can  manage to protect 10800 zone and break above 11100 levels then positive options open again but till that happens, Nifty is in danger of testing 10600 and 10200 below that.

Overall looking at the entire rally, we believe that this upmove started from 10583 and went all the way till 12103 (1500 points). Now 75% of retracement level of this entire upmove comes to around 10975 which is already broken. Now usually  an impulsive move doesn't get retraced by more than 61.8%-75% but exceptionally even 85-90% retracement level is possible which gives a level of 11750-11800 ( even these levels have been tested already). Incase market respect 10800 levels then we can hope for a short term bounce ( how far the bounce goes is a different matter altogether) but if 10800 breaks then we are most probably headed towards 100% retracement of entire rise which could open up further downside targets.

For now global markets have been working against Nifty ( but Nifty was falling when global markets were rising so can we expect the opposite now?) and at time of writing this post Dow future is more than 400 points down. It remains to be seen whether Nifty takes this fall in its stride and show some strength over 10850 levels (in which case we can expect to see higher levels) or it caves in (which could then mean a strong possibility of Nifty testing 10600 levels).

Happy Trading

Nifty Analysis, Outlook and Trend for 7th Aug 2019

Medium Term Trend: ↓ Down (Changes to Up above 11365)

Choppiness Continues: Nifty opened around 11815 but immediately bounced back to 11900 levels and kept inching higher for most part of the day. It touched a high of 11015 but failed to sustained and dropped to 10930 levels. It closed at 10948 levels up 31 points.

Nifty had a good long term support at 10985-11040 levels and we have had 3 successive closing below it already which is a bearish sign. If Niftys weekly closing also comes below 10985 levels then the upside possibility will diminish further.

Technically speaking , Nifty entered a strong bearish zone once it moved below 11K levels and now the crack have started appearing globally too, forcing most world markets in a downward mode. But the point to note is that Nifty started its downmove way earlier so it may not move in line with global markets for now. We were bullish on markets as long as 10985-11040 was holding out but now since the range is decisively broken, our stance have changed too and we wont be surprised to see Nifty testing lower levels from here.

For any bullish sentiments to play out, Nifty must conquer 11100 levels ( high of last Friday). A fast move above 11100 followed by crossing of 11360 levels will put Nifty back in the game for testing higher levels. Volatility is increasing daily and 150-200 points movement in one trading session has become a new norm nowadays.

In Nutshell, If Nifty can manage to cross 11100 and 11350 levels then we can hope for Nifty retesting 12K+ levels else weakness below 11900-850 zone could push Nifty all the way to 11600 and below that 10K levels.

Happy Trading!

 


 

Nifty Analysis, Outlook and Trend for 5th Aug 2019

Medium Term Trend: ↓ Down (Changes to Up above 11500)

Volatile day: Nifty yet again opened with a gap down at 11920 levels and went on to touch 11850 before a huge bout of short covering pushed it more than 200 points up. it hit a high of 11070 before dropping yet another 100 points from there. Finally it closed flat at 10997.

 

Nifty has become very volatile and is moving 200+ points intraday in both direction which is giving traders (on both sides) a tough time. If we keep the volatility part aside, the overall direction of market remains down and today even though markets have closed above 10985, the fact that a second consecutive closing has come below 11040 (that too weekly) is pointing towards a trend which is on the downside.

 

Like we mentioned yesterday, the only way Nifty to reenter bullish zone is to move back above 11200-250 zone swiftly. Today it made an attempt however lost steam towards the end. Need to see if Nifty attempts another shot at 11100 levels. Earlier in the year ( Apr-May) Nifty had broken above 11K levels after a very long consolidation of around 3 months now, moving back below this range has caused serious concern.

 

Todays pull back could be attributed to News flow coming from PMO office that tax on FPI could be reviewed going forward, however one wonder if its too late for that and damage is already done.We had also been mentioning that Nifty future overall OI is pretty light at ~1.6 crore however its not that light now. Its gone back to ~1.9 crores and this OI has been added on the way down.

 

Nifty is falling continuously and seeing these intraday pullbacks which are not supported by follow up buying the next day. We need to see Nifty reclaim 11100 and then goes back above 11200. If that happens 12K can be visited again however if it fails to do that then it can crash to 10500 and below that 10K is easily possible.  Nifty is at a crucial juncture now and if todays pullback was entirely news driven then it should not last for long.

 

Another thing worth mentioning is that global markets were moving up while Nifty was moving down. Now that Nifty has already moved below its previous low, Dow Jones and other indices have started moving down and nearing their previous low. So we need to assess if Nifty had anticipated such a fall in the global markets already.

 

Happy Trading!

 

 

 

Nifty Analysis, Outlook and Trend for 2nd Aug 2019

Medium Term Trend: ↓ Down (Changes to Up above 11500)

Weakness to the Core: Nifty Opened below 11100 and went on to break 11K and even 10900 intraday before a bout of short covering at lower levels pulled markets to 10985 levels. It closed down 140 points down to 10980 levels.

 

Nifty was down by around 240 points day at one stage however managed to recover 100 points in last 30 mins. We have been saying that as long as 11K is protected there is a chance of market bouncing back from these levels. We did see some intraday bounces ( like yesterday) but those were too shallow. We had also mentioned that close below 11040 or break below 10985 levels intraday will break the long term pattern. Todays closing is below 10985 levels and now the scenario has changed completely. There is a chance (a strong one) that even the long term pattern has changed now in favour of bear.

 

We were hopeful of Nifty sustaining 11K level, as it was something market had conquered after 3 months of sideways trading ( Feb-Apr). Now going back below the same level which took so much time to be crossed in the first place does not augur well for the near term.

 

The entire fall from 12103 was too slow which raised the doubt if the entire fall is just a corrective move, however as the time is passing by the speed of this fall is increasing which raises the question if the top was hit at 12K levels in July and not 12103 in may ( irregular top). Since markets hit 12K levels, the fall has been pretty sharp.

 

Now that we have had a close below 11040, it seems that  tables have turned and bullish possibilities have reduced to great extent. Since this  are was a critical support zone, we were optimistic and had been recommending long trades around 11150-11200 levels as there was a strong probability of market going towards 12K. It was a trade with good risk reward however it didn't materiliaze and we didn't see any sustainable major bounce. Having said this, now the flood gates have been opened and there is a strong possibility of nifty moving down from here. Of course the bounce of 100-200 points will keep coming in between but large trend should remain on the downside

The only way Nifty can Nifty open the bullish probability of 12K+ is by showing that todays breakdown was a false break. if its just a false break then markets should immediately move above 11200 levels. It should not hang around these levels for too long. Continuous trading below 11K-11150 zone could keep pushing Nifty down.

In Summary, the overall trend of markets have changed to down now and if weakness persists below 11K then Nifty  could head towards lower targets of 10500-10600 in near term.

Happy Trading!