iCharts Discussions

[saumitra]

Dear friends,

I have been an active follower of this forum, especially posts by apka, veerappan and shashangan. I have been trading index and stock options for more than 5 years now and thought I will share some of my own learning and analysis with you. So here I am

I will try to post my view, backed up by charts and data as often as possible.

Analysis for Monday:

Spectacular rally! Nifty extended the bounceback from the important technical support of 5-year strong trend line. June 28 close, being a weekly, monthly and quarterly close was very important and Nifty did not let us down. Propelled by the news of Gas price hike, Nifty gapped up above 5700, continued to go higher throughout the day and ultimately settled 150+ points higher, just short of the 200-SMA at 5840. Overall cash volume in the market at 14,700 crores was quite high, especially considering that this was on the first day in a new FNO series. After 13 consecutive sessions of selling, FIIs turned around in cash market and bought equity worth 1100 crores. FIIs also initiated 61,000 longs in index futures with 1700 crores of net buy. The last reasonable FII buy was on May 30! INR too shared the cheer and recovered 1.3% to close at 59.39.

It is likely that several market participants will characterize current rally as short covering, but then only time will tell. We need to ride the trend as far as possible. Nifty hourly charts are now showing solid strength, infact slightly overbought on MFI. A breakout on the upside is now confirmed by the close above 5780, the upper end of the channel. 5760 - 5780 zone should now provide support to Nifty for the coming days. Nifty faced its first hurdle at 5850 and the last hourly candle was sold with high volumes. A small correction looks possible and it should be bought with SL of 5760 if it does occur. There is a 60 point gap between 5760 and 5700, so expect a sharp movement to 5700 if 5760 is broken. Above 5850, the next resistance will come between 5970 to 6000 region.



Nifty daily charts are showing improvement with RSI and MACD deeply oversold and turning upwards. Nifty has taken support from bottom of the channel and bounced back. Top of the channel with the current arrangement is above 6300. Intermediate resistance will be provided by 200-SMA and a breakout above this level at 5840 will put Nifty in confirmed medium-term uptrend. Those already long on Nifty can now increase SL to 5760 and increase exposure above 5850.



Nifty weekly charts show an ascending triangle with 5-year strong trendline providing support. Breakout target from this pattern will be 10,000 on Nifty. However unlikely it may look right now, we need to patiently wait and see if the pattern is validated or broken. A decisive break below trendline on weekly closing basis will indicate breakdown and open downside in Nifty till atleast 4500. A breakout above 6300, will indicate upside till 10,000. Nifty closed the week in style with an extremely bullish candle with high volumes. Strategy for positional traders should be buy on dips with SL of 5690 and addition above 5850.



I said earlier that 'Banknifty will likely gain momentum above 11500', and it did. Next major resistance for Banknifty is at 12100, so expect a very swift and volatile movement between 11500 and 12100 over the next few days.

Despite heavy selling during the last 30 minutes on Friday, S&P managed to close the week and the month at 1606, above the important pschological mark of 1600. Since there is a strong resistance from 200-SMA at 5850, Nifty can possibly gap down on Monday, consolidate in the 5760 to 5840 region before deciding on the next big move.

Original link: [CONTENT REMOVED BY ADMIN]

[vinay28]

you are not allowed to post your link or any such link.

[SwingTrader]

saumitra,

Please do not post external links here, they are not allowed. You will also have to remove the chart image URLs and upload the images with your post. The image links are not allowed too as they link to an external blog/website. Please do so ASAP.

[saumitra]

Ok, no problem. I will re-upload the images as an attachment.