Nifty Outlook and Trend for 15th May 2019

Medium Term Trend: ↓Down ( up above 11640)

Market update: Volatility to the core: Nifty moved more than 400 points intraday today. It rose to 11300 levels from lows of 11110 and then dropped to 11175 and from there again rose to 11250 levels. It finally broke the losing streak and on 10th day Nifty put on 70 odd points and closed 11220 levels.

 

Yesterday we had mentioned that 11100-11060 levels is the final support for market and if market drops to around 11100 levels then some amount of momentum or short term buying can be initiated with a strict SL of 11040 levels. Nifty made a day low of 11108 levels and rose almost 200 points from there in intraday itself so there you had some intraday points to be made in Nifty.

 

We had also mentioned that markets can move in a line for max 9-10 days and after completing 9 days of straight fall yesterday the chances of a technical pull back was always there. But the problem is that pull back has come from pretty low levels ( 11100) and it may not take nifty very far now (but that remains to be seen) Nifty rose with a good momentum today and the good thing is there was no negative divergences on short term charts.

 

Now we need to carefully observe how this pull back is shaping up in the days to come. The way markets reacted from 11300 levels suggests that market is going to face stiff resistance at every rise hence one needs to be watchful. at the same time because of such a long losing streak there is always a chance of bounce back.

 

For an immediate basis 11300 and 11170 levels become critical pivot points for Nifty. If 11300-320 level is crossed and sustain for a bit then we can expect another 70-100 point rally ( even more) on the other hand if 11170-50 level is broken then we can test 11100 levels again and if its broken that we are looking at much lower levels in a hurry.

 

VIX is increasing and continue to hover around 27 ( which is pretty high). So in a nutshell we need to see how the current move up is shaping up before predicting the next nifty move. For any bullish option to materialize, Nifty should conquer 11400-450 levels soon and start trading above it for some time. On the other hand if this pull back ends before that then probably its just a pullback and market will start its downward journey once again.

 

Happy Trading