Plan

How I see the week ahead…

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.

Apr21-W4: Nifty trapped in triangle (Apr19 to 23)?

Last week was almost a replica of prior week, though the momentum was larger this time. Monday again was a red day but RSI signaled bullish divergence. This led to ascent during remaining days forming yet another doji on weekly timeframe. Thus, my hypothesis of weekly consolidation stands vindicated for 2 weeks in a row now (everybody writes such arrogant statements on twitter etc, why not me? 🙂 )

Now, here’s what I am looking at:

Nifty is now in a triangle and I expect further consolidation this week in the yellow highlighted box unless there is a breakout from triangle in either direction

Thus, scenarios for the week ahead…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighBetween 14250 and 14850
UptrendLowIf breach above 14850ish; to rise till 15000ish
DowntrendMediumIf breach below 14200ish; to drop till 14000ish

With last 2 Mondays being big reds, it would be interesting to see how this week begins. Such occurrences affect traders psychologically causing emotional biases. Furthermore, the continuous flow of negative news can also invoke bearish views. It becomes all the more important during times like these to focus on price action only.    

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-W3: Nifty consolidation to continue?

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…

ScenarioProbabilityAnticipated Price Action
ConsolidationHigh14550 to 15000
UptrendMediumIf breach above 15050ish; to rise till 15300ish
DowntrendMediumIf 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 

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-W2: Nifty on the rise?

I wonder how many people were actively trading the markets last week. With Holi and Good Friday cutting length to 3 days only, trading would have been a light affair. It seems Nifty too was keeping it cool. Green on first day, red on second, and back to first day high on third day. Good for investors but traders might have felt the churn.

With the candles hovering around moving averages, it is tough to say if we are in uptrend or downtrend though my bias is on the upside. Time will tell if RSI breakout is good enough for price to stay above trendline.

Scenarios for the week ahead…

ScenarioProbabilityAnticipated Price Action
ConsolidationHighIf rise till 15050ish; to stay above 14850ish
UptrendMediumIf breach above 15050ish; to rise till 15350ish
DowntrendLowIf breach below 14650ish; to drop till 14350ish

Thus, I am going to begin by selling puts unless I see a red opening on Monday and adjust positions as days unfold. I am expecting that like last week, we may see mix of green and red candles this week.  

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.