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[hemant.icharts]

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[anilsutarpune]

Week Ending:- 20-03-2015
Individual candlestick analysis:- This week’s candle has relatively small but significant red body indicating bears were in control(not absolute !). The candle also has long upper shadow indicating rejection of price at higher level. There is very small lower shadow which is not significant.
Candlestick Pattern on weekly chart: - Looks like inverted hammer but is not. Upper shadow is not big enough, also body is slightly big.
Inverted hammer like structure in down trend has multiple interpretations. Some traders believe that long upper shadow indicates rejection of higher price; while other believes that some of the bears are closing short positions leading to artificial shadow.
Both the interpretations indicate that price action is not conclusive and next week’s candle will be decisive in confirming the medium term trend. Hence key support and resistance levels and analysis of overall picture becomes important.
Looking at volume: - Volume is above average, but relative to previous candle it is little low. Looks like price is consistent with the volume and there is no anomaly. Hence possibility of continuation of previous trend is better.
Overall picture:- Overall picture appears bearish, as we have back to back bearish patterns, and now key level of 8575 is broken but market closed just below it. Market also tried to test 8750 but failed and closed much below. Every attempt of up move is met with selling pressure. So we need to look at possibilities to determine trade. In my opinion following are possible scenarios apart from 'free fall':-
Scenario 1- Market attempts to retest 8630/50 and fails to hold on closing basis- This will confirm medium term down trend and we may see lower levels. 8520-8500 is very important support level if taken out we may see 8330-8350.
Scenario 2- Market attempts to retest 8630 and holds. In this case Nifty may tread in a range with upside resistance at 8790.
Scenario 3:- Nifty holds 8520-8500 level on closing basis. In this case nifty may tread in range 8500-8790, first resistance at 8630.

Personally I will wait to see price action at 8520/8500 and (if) at 8630/50 level. My trading will be guided by ‘sell on ‘retest’ of resistance ’.

Risk Advisory: - Invest based on your own analysis and own risk. This forum is only for discussion

[iakash]

Hi Anil,

I have a question regarding reading weekly candles in the expiry week.

For e.g. In this week, some part of the candle will be formed by the expiring contract (Mar15), while the remaining part will be formed by the next month contract (Apr15). There is possibility of the difference in the premiums of the two contracts causing some distortion of the weekly candle. Do you account for this distortion while reading the weekly candle or will you interpret the candle as it is seen irrespective of any distortion caused by the difference of premiums?

[anilsutarpune]

[riteshucha]

good going anil... scenario 1 has come true to the point...
heartening to see such wonderfull analysis...

[amitagg]

Yes true
Also Ritesh where are you so wonderful levels of your friend........

[anilsutarpune]

Week Ending: -27-03-2015.
Individual candlestick analysis:- Big red candle. This week’s candle has large body signifying bears were in complete control. Also has small lower shadow indicating some buyers have started participating. Upper shadow is very small and is insignificant.

Candlestick Pattern on weekly chart: - There is no pattern. But inverted hammer like structure created on week ending 20th is now followed by a big red candle. This signifies that the inverted hammer like structure was genuine price rejection. Both the candles together indicate that nifty is in medium term down trend. So buying should be avoided on pull backs.

Looking at volume: - Volume is above average but relative to previous week it is low. There is slight disconnect in volume and price, this may lead to weakening of previous trend which was down. Important point to note is volume is falling for last three weeks. Volume analysis is pointing toward easing of selling pressure.

Overall picture:- Overall picture is still bearish. On chart medium term trend is down. If you look carefully at this chart you will notice that bears had started work six weeks back (almost Shooting Start on week ending 30th Jan). So bears at this movement have upper hand and hence we should expect selling pressure to surface at key resistance levels.

Key levels:- 8450/65 will act as minor resistance and close above will be first indication that bulls still have some strength. But if market fails at this level possibility of breaking 8320 will be high, taking market to 8150/35 in coming weeks.
8530 will be a strong resistance. Close above 8530 will open up-to possibility of trading range between 8530-8790, first resistance being at 8630.

Personally my trading will be guided by ‘sell on resistance and breakdown’. I will not buy till 8530 is held on closing basis.

Risk Advisory: - Invest based on your own analysis and own risk. This forum is only for discussion.

[anilsutarpune]

Week Ending: -03-04-2015.
Candlestick Pattern on weekly chart: - No pattern. This is not Bullish Harami, even though body and shadows are inside body of previous candle. For Bullish Harami body of second candle should be less than 25% of first body either black or white.

Individual candlestick analysis:- This week’s candle has big green body indicating bulls were in control. This candle represents some bullish activity. Market gapped up and traded up and closed near high.
Also this week’s candles do not have significant lower or upper shadow. Lack of upper or lower shadow occurs because of lack of participation from either camp. Hence we must remember that body of candle tells history while shadows point toward future.

Looking at volume: -Volume is low, can be attributed to truncated week but compared to some truncated weeks in December and January volume is still low. We cannot draw any conclusion at this moment based on volume. But I am of opinion that there is minor disconnect in volume and price.

Overall picture:- Overall picture is still bearish but the bearish trend is weakened. To continue the bearish trend key level needs to be broken. Also there are many resistances at top which are difficult to break. All this points out toward a range bound market (8750-8350).

Key levels:- 8630-35 is first resistance. If market is able to trade above 8635 for session or two we may see 8750.
8350/30 is significant support if broken we may see lower levels. 8175 is further strong support.

There are possibilities of getting nice intraday opportunities but for overnight positions this market is not good at the moment.

Personally I will not carry any overnight positions in this range.

Risk Advisory: - Invest based on your own analysis and own risk. This forum is only for discussion.

[anilsutarpune]

Week Ending: 12-04-2015.
Candlestick Pattern on weekly chart: - No clear pattern. But candle is almost shaven head (ignoring 7 point upper shadow). This was bullish candle. Green Sheave head represents dominance of bulls or can be sign of one sided session. But we must remember body of candle represents past and shadow points toward future.

Individual candlestick analysis:- This week’s candle had big green body indicating bulls were in-charge. Also this week’s candle had small lower shadow indicating buying surfaced with force at lower price. No or very small upper shadow points toward one sided session and lack of participation from bears.

The two lines mentioned above for upper and lower shadow are contradictory. Hence it is difficult to analyse at this moment as who will win next session. Hence we need to look at volume.

Looking at volume: - Volume is above average. There is no inconsistency in price and volume. Hence it appears to be a genuine bullish move and may have some more strength.

Overall picture:- Overall picture is still bearish due to back to back bearish signals on monthly and weekly charts. Trend will become neutral if we have close above 9000. Close above 9000 may confirm trading range between 9100-8750 for next few weeks. Failure to hold 9000 points toward lower trading range of 9000-8630 for coming weeks.

All above analysis is pointing toward some bullish strength but is not good enough to be called bullish.

Key levels:- 9010 is key level. Failure to hold this level will cause nifty to fall to 8630, first support being at 8750.
There is minor resistance at 8795. If nifty fails to hold this level on closing basis we may see rapid bearish action taking nifty below 8630 to 8375.

Personally I will be waiting for price action to unfold between 8795 and 9000/10

Risk Advisory: - Invest based on your own analysis and own risk. This forum is only for discussion.

[anilsutarpune]

Week Ending: 17-04-2015.
Candlestick Pattern on weekly chart: - Bearish Engulfment. (Open of previous candle:-8615, Close of this week’s candle 8606). Bearish engulfment must come after an uptrend; Nifty had minor uptrend prior to this week’s candle.
Bearish engulfment is good reversal pattern, works excellent as support and resistance (highest high of the two candles is the resistance)
This week’s bearish engulfment is further confirmation to previous multiple bearish patterns.

Individual candlestick analysis:- This week’s candle has large red body indicating bears were in control of session.
This week’s candle also has small upper shadow indicating failed attempt by bulls to move price up. Upper shadow is slightly less than 25% of body but is significant enough to indicate price rejection.
Candle has almost no lower shadow (10 points) indicating two possibilities- Bulls have lost the control or lack of participation by bulls towards close of candle.

Looking at volume: - Volume is low due to truncated week but compared to other truncated weeks, volume is average. Hence there is no disconnect between price and volume. This indicates possibilities of continuation of previous trend.

Overall picture:- Overall picture is bearish. This is third bearish pattern at the top. First Shooting Star then Evening Star and now Bearish Engulfment. This is indicating that the sellers are showing presence at the top. Hence for the near term TOP for Nifty is in place. Possibilities of breaking previous high are low and will require a significant event like actual rating upgrade. Possibility of Nifty entering in distribution phase at the top is high.

Key levels:- Bearish engulfment is good reversal pattern but is the not the best of the lot. Usually there is tendency to test 50% to 100% before going down. Hence price action near 8750 will confirm medium term trend.
There is support at 8510-8495 if broken we may see 8360-75.

Personally there is no long trade for me.

Risk Advisory: - Invest based on your own analysis and own risk. This forum is only for discussion.

[amitagg]

As per your analysis , I would have thought there is a trade. Pls explain why holding back just based on your analysis........

[anilsutarpune]

[anilsutarpune]

Week Ending: 24-04-2015.
Candlestick Pattern on weekly chart: -Shaven head. Almost no upper shadow. This is single candlestick pattern. This pattern is indicative if one sided session. This pattern indicates that bulls have surrendered or have not participated meaningfully. This is not a definitive pattern.

Individual candlestick analysis:- This weeks candle had big red body indicating bears were in charge of session. Also has no upper shadow indicating lack of participation from bulls or loss of control. There is small lower shadow indicating some buying happening at lower level but not enough to push prices higher.

Looking at volume: -Volume is high. Significantly higher than normal. Also relative to price fall the volume is bit higher. There is minor disconnect between volume and price. This is indication that previous trend (down ) may be challenged. We must remember that volume is early indicator of reversal. Hence caution is indicated.

Overall picture:- Overall picture continues to be bearish. There is some kind of distribution happening at the top. Hence we cannot say that long term bull trend is broken. At the same time possibilities of upside are now capped.
Weekly chart is at a critical level. Further down fall can lead to bearish picture extending to medium to long term. Any close below 7950 will make chart bearish for long term as well.

Key levels:- 8360-75 is broken. There is support at 8275-60. If this support is broken on closing basis we may see 8150, if 8150 is broken we may go down to 8075. Trading in 8150-8050 zone will be difficult, it is important to avoid excessive trading and trade less in this zone.
8450 is key resistance failure at this level will be indication of continuation of downtrend.
Please watch for price action near 8360-75 failure to hold this level will be indication of significant bearish activity.

Personally there is no long trade for me. My first preference is to trade with low volume, and continue to look for opportunities to sell on rallies till 8630 is held.

Risk Advisory: - Invest based on your own analysis and own risk. This forum is only for discussion.

[amitagg]

Fine but rallies did not come last time......or it did?
You have given two levels 8360 and 8630.
For selling into rallies one would again have to wait to watch price action at that point of time.
So there shall no trade for another week may be......... ( despite all your candlestick analysis confirming bearishness)

[anilsutarpune]