NIFTY WEEKEND ANALYSIS FOR THE WEEK ENDED 13TH AUG 2011

Nifty started the week on a very negative global sentiment, nifty open with a huge gap down opening of nearly 140 points on Monday, on Tuesday nifty hit a new 52 weeks low at 4946 level, on Wednesday Thursday and Friday the bulls tried to bring back nifty above 5177 level, but were unable to keep the index above the earlier suppors and nifty was aggressively sold of at everyrally, thus ending the week near its 52 week low, this is the first time when nifty closed the week below 5100 levels since june 2010. 

Let us see the alignment of some of the key technical Indicators

 

 Ichimoku: is in strong sell mode, and no chance of any reversal seen yet.

BollingerBand: nifty has been trading at the lower levels of the bollinger band in both daily and weekly charts for some time now, and might continue to make newer lows as for the first time in almost 2 years the monthly candle is trying to touch the base of the bollinger band which is currently near 4770 odd level

Support turned resistance:the previous level of 5177-5197 which was acting as a support on earlier occasions is now acting as a strong resistance, bulls need to bring back nifty above this level soon or the bears will drag nifty further south.

SUPPORT TURNED RESISTANCE

 Bearish Cross in Weekly charts: in the weekly charts 20WEMA moved below 50WEMA, this is for the first time since April 2009, indicating weakness.

20WEMA/50WEMA BEARISH CROSS

Fibonacci Extension: Lets have a look at the Fibonacci Extension of the rally from 196 to 5742 level, nifty has already  moved below the starting point of the journey north,

So far 123.2% or 5065 has been acting as a support to the bulls, however the bears need a close below this level to take the nifty to the next extension level of 138% or 4985 level, 150% is at 4920 level, and 168% is at 4856 level, keep an eye on these levels for creating aggressive intraday longs.

Fibonacci Retracement: Lets also have a look at the retracement levels of the fall from 5742 to 4946 level

So far the 23.6% or 5133 has been acting as a resistance for the bulls, only sustaining above this can see nifty at 5250 and 5344 levels, keep an eye on these levels for creating positional short position in nifty.




The Week Ahead:
the OI data suggests huge huge rise in the open interest with the fall in price indicating fresh short positions built in August Expiry, despite good IIP numbers market could not gain momentum over Thursdays close and bears enjoyed creating fresh shorts at higher levels, and the FII data is not very good for the bulls.
SBI has come out with the results, which are not very encouraging and the bears would not miss any trick to go short on this heavy weight, be cautious with fresh shorts on this counter,Also a likely rate hike by RBI in next meet in September would keep the banking stocks under selling pressure.

 Expected high for the week 5138- Expected low for the week is 4880,