Plan

How I see the week ahead…

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.

Jun21-W4: Nifty to consolidate this week (Jun21 to Jun25)?

Being right is one thing, being right to the decimal is awesomeness. Nifty somehow traded exactly between the black lines which I drew for last week, though I would have preferred it to break 15650 and fall to 15450. But it does give me confidence in my technical analysis skills. The unanticipated surprise though was Monday with Adani news breaking the internet and charts.

Now, here’s what I am looking at:

Nifty 50 index looks sandwiched and most likely it is going to stay that way at least till first half of the week. If the green support line is broken, we can see it slip to or below 15450. I continue to hold downward bias since I believe RSI needs to cool down and touch the support trendline.

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

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 15925 and 15450
DowntrendLowIf breach below 15450; to drop somewhere till 15250
UptrendLowIf breach above 15925; to rise somewhere till 16100

There continues to be a lot of skepticism around Adani group shares and if they are being manipulated via fund houses. Hopefully, the news has been accommodated and there should not be any surprises. The bigger news is Fed increasing rates which means flight of capital from emerging markets is on the cards.

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-W3: Nifty to give failed breakout this week (Jun14 to Jun18)?

I was anticipating that Nifty would go above the red trendline only to revert back. It did happen but everything was super slow. Lack of momentum did not let Nifty break 15600 and so the week simply died in a bullish consolidation.

Now, here’s what I am looking at (I have changed EMA & RSI settings as compared to last charts):

Timing of future price action is not something I am good at. My theory of failed breakout did not quite materialize last week but I still have the same bias. Therefore, my target for now continues to be the green rectangle around 15450. For that to happen, 3 trendlines would need to be broken but RSI divergence should take care of it.   

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

ScenarioProbabilityAnticipated Price Action
ConsolidationMedBetween 15900 and 15650
DowntrendMedIf breach below 15650; to drop somewhere till 15450
UptrendMedIf breach above 15900; to rise somewhere till 16050

There was just 1 high range candle last week. Let’s see if the fall happens this week. Option buyers would still need to time it properly. And since I lack that skill, I would prefer to sell call options if I can squeeze some free time from office.

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 5- to revert to mean this week (Jun7 to Jun11)?

Beginning last Monday with a high range bullish candle, Nifty continued its upward momentum. In such a scenario, my target for Nifty was 15650 but it even breached 15700. I can’t complain much as it is always tough to give a target when skies are clear. And well, Nifty did close the week at 15650 anyway.  

Now, here’s what I am looking at:

I now have a hard bias for mean reversion as this is the kind of setup wherein I like to sell call options. It is entirely possible for Nifty to go above red trend line but that would be a fake breakout. My target for now is the green rectangle around 15450.    

Thus, scenarios for the week ahead (highlighted as yellow box in chart)…

ScenarioProbabilityAnticipated Price Action
ConsolidationMedBetween 15600 and 15850
DowntrendHighIf breach below 15600; to drop till 15450
UptrendLowIf breach above 15850; to rise but not by much

The daily ATR of Nifty has been declining steadily and may bottom out in a couple of weeks. Low ATR is a pain for option sellers as they make safe money but not much money. Things shall become interesting when ATR turns its head upward again.     

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-W1: Nifty to consolidate this week (May31 to Jun4)?

Though I have not been able to find time to trade Nifty mainly due to office work, I could not resist making a brief analysis for this week especially since Nifty has hit ATH. Congratulations to those who stayed invested.  

Now, here’s what I am looking at:

Saying that Nifty has broken previous ATH would be a call made too soon. This week is crucial to see if Nifty has broken the red resistance rectangle.  

Thus, scenarios for the week ahead…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 15500 and 15250
DowntrendLowIf breach below 15250; to drop till 15100
UptrendLowIf breach above 15500; to rise till 15650

Lingering around ATH levels is always a very tricky situation and I personally think Nifty is far away from its averages and thus, revert to mean is a good possibility. RSI structure too is a bit confusing. So, consolidation should be the name of the game, this week. 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.

May21-W1: Nifty correction due to failed triangle breakout (May3 to 7)?

I have to admit that I got it wrong last week. Since Nifty was always somehow taking support from 14200 (happened 3 times), I should have written that probability of bounce was higher. Even RSI with its divergence was hinting this. Even then, I would never have expected range of bounce to break triangle by such a huge margin. At the end of week, Friday played spoilsport bringing Nifty back inside triangle.   

Now, here’s what I am looking at:

My bias is on downside as I believe that this is a pattern failure. I expect coming week’s price action in the yellow highlighted box

Thus, scenarios for the week ahead…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 14250 and 14850ish
DowntrendHighIf breach below 14250ish; to drop till 13850ish
UptrendLowIf breach above 14850ish; to rise till 15050ish

Even Nithin Kamath was amazed by the rally witnessed last week. The disconnect between reality and market continues but I guess this market is a function of liquidity and not of fundamental factors. In any case, I am neither a fundamental analyst nor an expert at expert analysis. And then there is this disclaimer anyway 🙂

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.

Apr21-W5: Nifty to drop below triangle this week (Apr26 to 30)?

Red openings have been opening for 3 Mondays in a row now. The difference last week was that there was a gap down which was filled to a large extent on Tuesday. Overall, Nifty did not ‘move’ much but over the past 3 weeks, it has been steadily going down.

Now, here’s what I am looking at:

Though Nifty has been failing to break the triangle, my bias is on downside since Nifty is below the moving averages and I expect coming week’s price action in the yellow highlighted box

Thus, scenarios for the week ahead…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 14150 and 14550ish
DowntrendHighIf breach below 14150ish; to drop till 13800ish
UptrendLowIf breach above 14550ish; to rise till 14800ish

I wonder how this Monday will begin. Will it break the pattern of past 3 Mondays by opening in green? But if it does so, will the rest of days go in red? It should not feel bad to see Nifty levels travelling towards realistic levels. The party has gone far too long and far too loud.    

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.