NIFTY WEEKEND ANALYSIS for the week ended 08TH OCT 2011

Nifty yet again started the week on a negative note and reached the lows of 4720, but managed to protect the lows and the pressure continued, with holiday on Thursday and global negative clues saw nifty closing near its 52 weeks low, good rally in global markets on Thursday lead to a sharp gap-up opening on  Friday (with limited price action during the day, nifty  close at 4888 , 14 points gain over previous week, making a long legged doji or a pinhead in the process. Moody,s downgrading of top banks added to the pressure and bankex showed bigger losses as compared to Nifty

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

 Ichimoku Kinko Hyo: 
Gave a sell signal at the start of the week, this is a strong signal as the price action is well below the cloud, Friday close above the Conversion line gave some hopes for the bulls.
Any upmove from here would face resistance at the cloud( Komu) at 5036-67 levels

BUZZING NIFTY: ICHIMOKU KINKO HYO SELL

Bollinger Band: Nifty started to rise from the lower BB and would gain momentum only on a close above the mid BB currently at 4972 odd level

BUZZING NIFTY: BOLLINGER BAND

 

NIFTY MOVING IN A CHANNEL

From the up move to the high of 6339 to a low of 4720 nifty is moving in a channel, giving good trades, nifty after touching the lower end of the channel at 4720 level is now moving north and would be targeting 5550 odd levels.

   

BUZZING NIFTY: NIFTY CHANNEL

  

NIFTY BEARISH FLAG:

Nifty has formed a bearish flag, the price action has also formed a channel a break from the range will give a clear larger direction to nifty, however a break down of the channel is the preferred view, the bearish flag pattern will then have a target of the length of the pole, a good 1000 point fall on the Nifty.

BUZZING NIFTY: BEARISH FLAG

38 DAY EMA :  This moving average has been successively giving good trades throughout the year 2011,only a comfortable move past 5020 level would add strength to the BULLS

BUZZING NIFTY: 38DEMA

FIBONACCI RETRACEMENT LEVELS

Fibonacci retracement levels from a fall from 5740-4720 level, indicated immediate resistance at 4952 and 5110 level and the next hurdle would be to cross the 50% level at 5230 and above that is the unfilled gap Zone.

BUZZING NIFTY: FIBONACCI RETRACEMENT

SHORT TERM FIBO PROJECTION:

Nifty got resisted at 61.8% of the fall from 5035-4727 level, a move past 5035 would change the short term trend in favor of the bulls, however fail to stay above 4917 level would encourage the bears to pull Nifty down again to the lows of 4720 level

BUZZING NIFTY: NIFTY SHORT TERM FIBONACCI EXTENSION

NIFTY BULLISH FALLING WEDGE:

Nifty is moving in a falling wedge pattern which is a bullish reversal pattern if formed at the bottom of the price action, watch for the breakout above 4917  for early indications of the change in trend in favor of the bulls, a fail to cross 4917 level would lead nifty to the bottom of the wedge making newer lows before the bullish breakout.

BUZZING NIFTY: NIFTY BULLISH FALLING WEDGE

NIFTY- 9RSI SIGNALS

BUZZING NIFTY: 9RSI--NIFTY PRICE BEHAVIOR

 9RSI- a tool to analyze oversold/overbought conditions besides showing relative strength, has been giving good trade setups and early indications of larger moves in the making, the chart shows  some instances where NIFTY--9RSI have given good setups marked as 1(1A-1B) 2(2A-2B) AND 3MARKED AS 3A&3B

1. In the 1st instance when nifty made lower lows the RSI made higher lows, indicating higher relative strength and resulting in higher high in Nifty.
2. In the 2nd instance when nifty managed to make the 2nd top at 5700 odd level, the RSI made a lower top indicating relative weakness and nifty fell on to make newer 52 week low.
3. In the 3rd instance marked as 3A&3B show  that nifty almost reached its 52 week low (4720 {3A}-4727{3B}) the 9RSI has managed lower lows and turned up on Friday, can this setup manage to give strength to the Bulls this time around ????? the price action would have to confirm this by moving above the channel.

 THE WEEK AHEAD: Global market turned from the bottom and gaining good ground, the Indian markets missed out for a day due to Holiday and would sooner or later cover up the lost opportunity, Moody's downgrading of global Financial Institutions has shown the pressure  but the other sectors have managed to keep the index up and the Financial sectors are to be watched for further Strength/ weakness

Expected High /Low for the week 5002-4808, positions taken near these levels would give good trades for the week

HAPPY TRADING!!!!!!!!!

NIFTY ANALYSIS AFTER THE CLOSING BELL

Nifty is at a make or break zone, making it the most dreaded part for the traders, a lot of action today was near the break point of the fall from 6339 to 5690, however the level was not tested today , but the chances of breaking the same could not be ruled out.

BUZZINGNIFTY: TRIANGLE FORMATION

A symetrical triangle in nifty in 30 min time frame, a break in either direction would give around 65 points move.

BUZZING NIFTY: MAKE OR BREAK POINT

In the second chart we can see, the important price zone which could decide the course of nifty in short to medium term, the action today was inside this zone, a close beyond this channel will help take a trade in the direction of the break.

BUZZING NIFTY: SELL IN MACD/ TEST OF 200 DMA

Although the bulls managed a close above 200DMA, but most of the price action today was below this all important moving average, as long as this is protected the bulls can hope of some recovery, MACD a very reliable indicator turned down and gave a sell signal , a close below 200 DMA which is currently around 5733 will favor the bears.

BUZZING NIFTY: BEARISH FLAG

The hope for the Bears is the formation of a bearish Flag in the hourly time frame, price action below 5710 would only attract more selling, the target of this formation is roughly around 175 points.


Till the range is not broken out , trade light and book smaller profits, a sell around 5778/ 5805 and buy near 5710/5690 with small stop-loss ( not more then 10-15 points)would be a good trade till the direction of nifty is not clear.

NIFTY WEEKEND ANALYSIS for week ended 1st April. 2011

Nifty started the week on a positive note and continued to rise through out the week before giving a flat close on Friday and closed at 5826 as compared to previous weekly close at 5654. A good gain of nearly 170 points for the week, The April contract started on a negative note, with immediate resistance at previous days high of 5873, unless that is crossed the bears have some hope for this expiry.

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

 

 Elliot Wave Count:
Although i am not very good at EW readings but this is how i see them at the moment, a move past 5681 eliminated the previous wave count possibility, currently we have two possibilities

 

BUZZING NIFTY:ELLIOT WAVE COUNT

 

 1). The corrective wave from 6339 in the form of ABC correction,where B is under making, or is it completed???? and C wave down to follow. If A=C then nifty might slip to sub 5000 levels, for that the 2nd possiblity of corrective 5 wave formation, has to be invalidated.

2). Up move from 5177, with 3rd under process and wave 4 could bring nifty to 5690 odd level,if nifty gets support at 5690 and start moving up then the 1st wave count gets invalid. lets see how the price action in the coming week decides the direction of nifty, will update on this as prices unfolds .

 Ichimoku: Gave a weak buy signal on 23^th March with the nifty around 5420 level  and nifty trading below the KOMU but the rise during the week not only took nifty into the cloud but managed to move wall past the upper boundary of the cloud,For the first time since the fall from Jan the price action have moved above the cloud, indicating the power of the bulls at the moment, the first sign of weakness would be seen once nifty starts trading in the cloud roughly at 5715 level.

BUZZING NIFTY:ICHIMOKU PRICE ABOVE CLOUD

 

BollingerBand: As indicated last week despite trading above the upper range of the bollinger band nifty continued to do the same throughout the week, the opening on Monday and price action for the first two days of the week will help to analyze the coming moment in nifty

BUZZING NIFTY: BOLLINGER BAND

 In the weekly chart the prices rose from the bottom of the bollinger band,  cleared the first resistance by moving past the mid value of the bollinger and trading above it , on its way up it could take nifty to 6100+ odd levels, the current support is around 5707 level.

BUZZING NIFTY: WEEKLY BOLLINGER BAND

 

DEATH CROSS( 50DMA Crossing  below 200DMA)

The DEATH CROSS was Formed in Nifty on 4th March 2011, It is considered highly Bearish, The Last Time when we saw this formation Nifty slipped from 4800 levels to 2300 odd Levels, as the name itself indicates highest degree of Bearishness

However  nifty decided to move past 50&200 DMA,

Recently  there was a similar cross in S&P Index in US, but the Price movement proved otherwise,will this happen to our markets as well, currently the support of 200dma is at 5704, below which nifty gets weak.

BUZZING NIFTY: DEATH CROSS

BULLS/ BEAR POWER

This is one indicator which i,ve recently added to the study, this simply indicates the power of the BULL/ BEAR as compared to the price action.
As can be seen in the Chart that the bears power has been reducing, whereas the bull-power indicator has seen a sudden rise and given a breakout from the range, indicating the bulls are not only gaining the control over bears but also able to move the prices above the range. A fall from 5873 level in the last two days indicate that the bulls are loosing the momentum at the moment  whereas there is no increase in bear power, indicated that the bears are not confident at the moment.

BUZZING NIFTY:BULL/BEAR POWER

  BEARISH FLAG
In one of the previous post we saw a triangle formation and a bearish flag in Nifty, although the triangle  as well as the flag has given a breakout, but will have to keep an eye on the false breakout, before reassumption of the actual trend



GARTLEY BEARISH: ALTERNATE BAT


Nifty got resisted at the lower boundary of the bat formation after touching 5873 nifty fell sharply, however the time target for the formation is till 6th April, since this is a bearish pattern nifty would slip to previous low around 5233.

BUZZING NIFTY: ALTERNATE BAT

NARROW RANGE 7


If a price bar's range is less than the previous 6 bars' ranges (measured independently) it is said to have the narrowest range in 7 days or NR7, its implies  reversal of the trend or loosing of the momentum.

BUZZING NIFTY: NR7

RESISTANCE;As can be seen in the chart there are multiple resistances near 5935-65 range, a move past these resistances will see nifty continuing the journey north.

BUZZING NIFTY: RESISTANCE LINE

For the week support is seen near 5700 level and resistance near 5965, risk reward ratio for the positions taken near these levels would be high near these levels.

NIFTY TRIANGLE & BEARISH FLAG FORMATION

TRIANGLE

BEARISH FLAG

The first chart is a symmetrical triangle formation, the break of the triangle will give a good 300+ points move in the direction of the break.
The second chart is a bearish flag formation, technical target of the same is the length of the pole, roughly 950 points from the break of the flag, first indication of the same would be a breakdown of the triangle.