Even though Nifty began last week with Covid fever, the recovery was equally brilliant and by Friday, we are back to where we started. At an overall level, I can safely claim that my prediction of consolidation with a mix of red-green candles was correct (more details here). However, the manner of consolidation took me by surprise. I am sure it would have caused a lot of trouble for traders as well.
Now, here’s what I am looking at:
Nifty is clearly consolidating in a range, highlighted as yellow box. But since price is above averages, the bias is on the upside.
Thus, the following are scenarios for the week ahead…
|Scenario||Probability||Anticipated Price Action|
|Consolidation||High||14550 to 15000|
|Uptrend||Medium||If breach above 15050ish; to rise till 15300ish|
|Downtrend||Medium||If breach below 14500ish; to drop till 14200ish|
I personally don’t think that the continual rise of covid cases over the weekend would cause a red opening since that factor was already accommodated last Monday. However, if states like Maharashtra impose lockdown, it can trigger selling. Let’s see
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