Plan

How I see the week ahead…

nifty week ahead

Sep21-W2: Nifty to top out this week (Sep6 to Sep10)?

Price broke loose above 16725 and a 1000 point move happened in 1 week. One needs to just think about that statement for a minute – ‘1000 point move on Nifty in a week’. Wow. Twitter kept throwing projections about Nifty 17000 randomly for almost past 6 months. But did anyone say that it will happen in a week?

Now the following is my analysis for coming week based on what I am looking at (You may want to open image in new tab or save it for better view)

Parallel channels are hard to draw. In an uptrend, drawing the bottom line is a no-brainer but placing the middle and top lines take fair degree of judgment. My last judgment was wrong and I have made adjustment in this drawing. Given the momentum, I expect Nifty to enter the blue channel zone (an extension of black channel). However, price would then be way above moving averages and mean reversion would become priority.

Scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationMedBetween 17600 and 17000
DowntrendMedIf breach below 17000; to drop somewhere till 16725
UptrendMedIf breach above 17600; to rise somewhere till 17800

Nifty has outperformed all other global indices on past 1 month and 3 month timeframes and that too by a very large margin. I have absolutely no idea why.

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.

Nifty channel chart

Sep21-W1: Nifty to bounce between parallel channel this week (Aug30 to Sep3)?

Though the market though began with a gap-down last Monday, it remained in a rising mode throughout the week. The market tested the red rectangle and is now hovering around it. The hovering has been happening for last 3 days now and this consolidation is what I was anticipating last week.

Now the following is my analysis for coming week based on what I am looking at (You may want to open image in new tab or save it for better view)

Even though the price action is shouting for a breakout above red rectangle, RSI is giving a different story. It almost looks like a head and shoulder formation in the making on RSI along with possible divergence. Furthermore, the Bollinger bands have expanded too much and are set for compression. Thus, I remain neutral on market for now due to conflict between price chart and momentum chart. The market might just consolidate in the parallel channel.

Scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationMedBetween 16900 and 16500
DowntrendMedIf breach below 16500; to drop somewhere till 16275
UptrendMedIf breach above 16900; to rise somewhere till 17050

Just like ‘winter is coming’ in Game of Thrones, the world is chanting ‘taper is coming’. When it comes, the flight of money from stock market to safe havens like USD and gold is imminent.

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.

nifty aug end

Aug21-W3: Nifty to remain range-bound this week (Aug23 to Aug27)?

There are times when I surprise myself with my predictions. Last week was one of them as I wrote about Nifty to face resistance around 16675. Though it would have been a better prediction had Nifty touched mid of my parallel channel but who am I to dictate how market should behave.

Now the following is my analysis for coming week based on what I am looking at (You may want to open image in new tab or save it for better view)

While last Wednesday saw a gap up opening and closing as a fat red candle, Friday was a gap down opening with closing as a green candle. This is too much to take and I expect market to remain range bound for the coming few days. Alternatively, Nifty may touch lower end of the parallel channel to take support. But I would be surprised if RSI breaks the support line.

Scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 16650 and 16150
DowntrendMediumIf breach below 16150; to drop somewhere till 15950
UptrendLowIf breach above 16650; to rise somewhere till 16875

It is ironical that such big trending news on Afghanistan has no impact on global financial markets. I hope that stays the case for future as well. However, uncertainty on tapering by US is not cool. This will make market volatile until a clear direction emerges.

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.

nifty analysis

Aug21-W3: Nifty to rise slowly this week (Aug16 to Aug20)?

Like I was anticipating, Nifty did have momentum. Nifty did reach top of my red rectangle. But what Nifty did next was not anticipated. It broke above the rectangle and ended Friday with a big green candle.

Now, here’s what I am looking at:

This is a strong uptrend. It would not allow market to go low. RSI too does not have any divergence. Thus, market may continue to move up or stay around this height. The mid or top of parallel channel should be the target.  

Scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationMedBetween 16675 and 16350
DowntrendLowIf breach below 16350; to drop somewhere till 16050
UptrendMedIf breach above 16675; to rise somewhere till 16925

Fundamentally, there is still no news that can pause this juggernaut of a market. The world is living in euphoria. It remains to be seen how long this lasts.

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.

nifty analysis

Aug21-W2: Uptrend almost over, Nifty to hang around this week (Aug9 to Aug13)?

My last week’s analysis was a case of right observation, wrong diagnosis. Yes, Nifty was range bound but expecting it to remain like this forever was a stupid call. Nifty broke the range to go in in uptrend with high momentum.

Now, here’s what I am looking at:

Nifty does have enough momentum to reach the top of red highlighted channel. However, law of moving averages is also at play here. Thus, I remain neutral on market.

Scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationMedBetween 16350 and 16150
DowntrendMedIf breach below 16150; to drop somewhere till 16000
UptrendMedIf breach above 16350; to rise somewhere till 16500

The liquidity forces continue to rule this uptrend. As long as inflation rates remain in check, there is no reason for money to exit stock markets.

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.

nifty analysis

Aug21-W1: Nifty Index 50 to do nothing this week (Aug2 to aug6)?

As stated last week, the support trendline (highlighted as green in this chart) was important. All hell broke loose on July 28th when Nifty Index 50 broke that trendline. The market though was able to pull itself back above the trendline and basically consolidated for next 2 days.

Now, here’s what I am looking at:

I personally do not like the drawings. There is too much clutter but at the same time, it all seems important to me. Nifty index 50 is caught between a rock and hard place. The logjam may continue this week to create a tight squeeze before breaking out in either direction. Thus, I remain neutral on market.

Scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 15975 and 15575
DowntrendLowIf breach below 15575; to drop somewhere till 15400
UptrendMedIf breach above 15975; to rise somewhere till 16150

The fed rate even is behind us. Most of the Indian stock results are behind us as well. Absence of any important event strengthens the case of consolidation. However, one major event is RBI monetary policy meeting wherein governor’s commentary can influence market. I personally do not anticipate any major influence from it though.

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.

nifty analysis

Jul21-W5: Nifty Index 50 to wait this week (Jul26 to Jul30)?

As stated last week, the drop below green trendline (no more visible in this chart now) will lead Nifty index 50 to 15600. But the rebound from that level has been quite strong.

Now, here’s what I am looking at:

I personally do not like the drawings. There is too much clutter but at the same time, it all seems important to me. Nifty index 50 slipped from an upward channel and found itself stuck in a downward channel. The blue trendline now looks like a major support. However, breaching all time high needs momentum which has been lacking for past 3-4 weeks now. Thus, I remain neutral on market.

Thus, scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 15975 and 15725
DowntrendLowIf breach below 15725; to drop somewhere till 15450
UptrendMedIf breach above 15975; to rise somewhere till 16225

The Fed has a complex decision to make. Inflation is rising steeply in US. If Fed decides to raise rates, it will trigger a fall in rest of the world markets. So, let’s see

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.

Jun21-W4: Nifty Index 50 to decide direction this week (Jul19 to Jul23)?

Nifty Index 50 has consolidated for far too long and now seems to be itching to create all time high. The lack of momentum though is a dampener and 15900 – 16000 range has acted has strong resistance

Now, here’s what I am looking at:

RSI is good representation of what has been happening. The sandwich between trendlines is simply not getting digested. Like I said earlier, it is clear that if Nifty reclaims parallel channel, buyers will win but drop below green trendline will give opportunity to sellers. As of now, I do not have any bias.

Thus, scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 16000 and 15775
DowntrendLowIf breach below 15775; to drop somewhere till 15600
UptrendLowIf breach above 16000; to rise somewhere till 16150

At a global level, there seems to be quiet and peace everywhere. At a local level though, the impact of earnings can influence the swing either way. So, let’s see

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.

Jun21-W2: Nifty Index 50 to slowly slide this week (Jul5 to Jul9)?

Nifty Index 50 failed to show strength in upward direction too. Earlier, it did not fall much despite divergence and now it is not moving upward. It is frustrating. Anyhow, it remained exactly within black line boundaries of my last week’s yellow box.   

Now, here’s what I am looking at:

Nifty index 50 has respected a parallel channel and is on the verge of slipping from it. If that happens, the green trendline should give support. On the flip side, if Nifty continues to somehow remain above lower trendline of channel, then it can again try to cross the glorious level of 16000

Thus, scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 15850 and 15550
DowntrendMedIf breach below 15550; to drop somewhere till 15350
UptrendLowIf breach above 15850; to rise somewhere till 16150

The lack of volatility is always a sign of quiet before storm. With weekly timeframe also showing signs of exhaustion, my bias is on the downside for next couple of weeks. But market doesn’t read my blogs. So, let’s see

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.

Jun21-W4: Sky is the limit for this week (Jun28 to Feb2)?

Nifty Index 50 did slip below my green trendline only to claw back. Despite the gap openings, Nifty continued to remain within a defined range. It couldn’t break the red box but it did not go down either and thereby, vindicating my last week’s theory of consolidation.

Now, here’s what I am looking at:

Despite the negative divergence and hit from red box, Nifty continues to hold itself quite well. It is resilient to any downward movement. Moreover, banknifty has joined the party with fireworks. Thus, my bias is on upside with a big movement coming up. But I have this big red box on top which is Fibonacci extension of Nifty’s upward trend since last year. Fibonacci is always subjective but I believe 16200 should give resistance for now.     

Thus, scenarios for the week ahead (highlighted as yellow box with black lines dissecting scenarios)…

ScenarioProbabilityAnticipated Price Action
ConsolidationMediumBetween 15925 and 15650
DowntrendLowIf breach below 15650; to drop somewhere till 15450
UptrendHighIf breach above 15925; to rise somewhere till 16200

If this upward move happens, it might be nothing but part of the failed breakout which I have been anticipating for quite some time now. Basically, Nifty might breakout above the wedge (drawn as combination of red and green trendlines) only to fail. Let’s see.

DISCLAIMER: I am not a SEBI registered adviser. All the information provided on this website is for educational / informational purposes only and should not be taken as investment advice.