Category Archives: Nifty

#126 Nifty Update: "COCKTAIL" of signals on NIFTY Chart

Again a Bollywood connection of NIFTY this week with Saif’s movie “Cocktail”. I havent seen the movie yet but from the trailer i could make out that Saif is friend with both of them and at last he has to choose from either Diana or Deepika… Same is the case with the chart abv..In this case Saif is NIFTY and Deepika and Diana are Bear and Bull… Saif (nifty) in our case is confused at this stage that whom to choose. Currently NIFTY is trading in the minor trends upward channel while its in Major downside channel, one gap above upto 5300 while another gap at 5170 on downside and its trading above all the long term moving averages while it gave false breakout of FLAG pattern. So its all Hoch-Poch on the nifty side technically. You might be questioning why is that thick resistance line drawn below few candles?? But you may notice that all the close are at the Line so the line is valid and secondly 2 candles have given a marginal close above the line but the next day again it closed at the line so breakout is not confirmed. Fundamentally, we say many events last week starting with INFOSYS worst performance last quarter and better performance from TCS. IIP numbers has improved MoM. Inflation number next week will  also be reflected on the next week move. Internationally we have seen same mixed news last week. Jobless claim has decreased in US but LIBOR scandal is taking heat in media and it is expected to cost $20billion to banking industry if it is solved. So it was all a “Cocktail” last week in the markets around the world. Now what further on the NIFTY?? Technically speaking NIFTY should follow that small upward channel… Be long on NIFTY with stop loss of 5200…Upside resistance is at 5370 ….Speed breaker resistance at 5280,5327.. Strategy Take a long position with stop loss of 5200 and Go Short below 5160.

#125 Nifty Update: 70 points rain cools off all traders

NIFTY had been range bound last week between 5280-5327 which was considered to be consolidation phase. NIFTY has confirmed the flag pattern breakout on charts today which is considered to be bullish for near term. Fundamentally we have not received any cheering news for the traders but this rally is purely technical or investors are anticipating good news in coming weeks. Partial mining rights are given in karnataka’s ban which was lil thing to cheer but no FDI investing allowed is still a inflow problem which is depreciating rupee against all foreign currency. Globally something to cheer was that spanish banks have got bailout but on other side we are witnessing scams in LIBOR rate. Many american banks have started submitting their “Wills” which clarifies what shareholders and clients get if they go bankrupt. While Europe’s PMI number is still below 50 level signifying a downturn. Germany posted worst numbers for manufacturing in last three years. Accumulating all the fundamentals bears have more chances of winning. Coming to NIFTY technicals we have witnessed a Flag breakout which gives the target of 5425 but we have to speed breakers before that. 5360 is the strong level on weekly chart on closing basis which means this weeks close should be above 5360 while daily chart has 5384 has strong level for this week. Now all depends on few key data this week such as HDFC result tomorrow and INFY , TCS ans IIP Data on day after. So my call is HOLD your longs and add positions above 5360 and on downside exit positions below 5280.

#124 Nifty Update: NIFTY Pulling up its Summer "shorts"

Its the summer time and Shorts are in trending on the youths while traders are trending with NIFTY’s short covering. Yesterday we show a reversal pattern “Morning Star” (circled in graph) which is a sign to an end of bears and start of bulls. After long time NIFTY has closed above short term moving averages (Yellow-5SMA , Green 10SMA) which is also a sign for some bullishness on markets. Indicators on daily chart are highly oversold which may also bring some upside movement. Why am i calling it Short covering and not bull run?? Its because fundamentally we dont have any good news factoring in nor bad news , its just traders are gonna cover their shorts next week due to expiry. Petrol Price hike was a good news for OMC’s which was the reason for the upside move in oil stocks in last two days. Listed Companies are positing mixed results within the same sector. We dont have any major event lined up next week so we may go long for a week with stock specfic.

On weekly chart market has closed exactly at resistance point and its important for market to open positive and remain above 4936 for nxt week. Next Thursday being last day of the month, it is also imp for us to look on monthly chart. Monthly chart is said to be in bullish mood since february this year. If market closes above 4900 nxt thursday then we can be bullish on NIFTY based on monthly chart.

Strategy: As i mentioned in my last post that people should keep a stop loss on shorts at 4936 and we achieved that point on NIFTY today. Now risk takers can go long the NIFTY at CMP with tgts of 4975,5030,5090 where as safe traders go long only above 5170 which is considered to be boundary line for short covering.

#123 Nifty Update: NIFTY ko garmi lag gayi!!!

Since the breakout of triangle on the downside, NIFTY is giving more and more bearish signals on the way to downside. We could see that on the chart that we got to “Bearish Engulfing” signs which is a bearish signal. But today we have seen a “hammer” which is a sign that markets MAY change the course from here. All the indicators are already in oversold zone but we cannot take that signal as the bullish sign as markets can stay in oversold zone for even months.

On weekly chart too we have seen some bearish breakout last week. We could see that there are two valid channels. NIFTY has confirmed the bearish breakout from sub-channel last week while this week it has not been able to move up that level of 4936.

Considering Technically factors we are more biased on bears side, where as fundamentally also we have not got any sign of turn around from here. Rupee is at the life time low at 56.20 which is a negative sign for our markets.

Strategy: Still Hold your SHORTS initiated at 5170. Book profit on upside if NIFTY closes above 4936 on weekly basis. Add more shorts if NIFTY closed below 4785 on daily basis. 

#122 Nifty Update: Is 8950 possible on NIFTY?

Looking at this chart, all the technical analyst including me will get bullish on the NIFTY. This chart is NIFTY’s monthly chart. As we could notice technically we are witnessing a “Flag” pattern which is a continuation pattern. This Flag is on the way during bull run so we can expect a bull run ahead. Breakout was 4 months in FEB as u could notice. Since than market has taken support of the resistance line of flag. This pull back to support line is a common thing after a breakout from a pattern so we can still consider this as a valid breakout. The question remains whats the next strategy?? NIFTY should close above 4900 this month to be in the bull run. Risk takers can short below 4900 while safe traders and long term traders can wait for this month confirmation. If the market closes above 4900 for the may month than we can get upside long term target of 8950 as per the breakout out formula.

To add support to MONTHLY chart we have even seen a bullish reversal sign today on the daily chart which is “Bullish Engulfing”. This candles stick pattern has often given a great reversal signal. So risk takers can be bullish on the market while safe traders can wait for month end. Fundamentally rupee is getting weaker and weaker. And the cause?? We the people. Air India is on strike, Kingfisher cancelling flights and Jet Airways discontinuing foreign routes which is increasing demands for foreign carriers which results in demand of dollars in exchange of rupees depreciating our own currency. We should understand and pilots should closeout this strike as soon as possible. On the other hand indian banks are being downgraded by foreign rating agency which is also a shocking news. On other hand ,Market leader, RIL is not performing as per expectation on the basin. Output is decreasing day-by day.. So all strong technical reasons are counterattacked by Fundamental reasons. So i would suggest safe traders to wait for the month end while risk takers go short below 4860 or go long above 5170

#121 Nifty Update: CRIME Suspected

My last two posts suggested downside rally and indicators still believe so with fundamentals such is USDINR and greece fear suggest. But technically a CRIME is suspected against the trend..I emphasize “Suspected” meaning not confirmed but depends on few conditions. After a free fall from high yesterday Today we witnessed a gap down opening from yesterdays closed and market draw both side and than closed near the opening creating a “Doji”. Last two candles are perfect characteristic of “Three candle” formation Morning star which can be a bullish reversal signal. Tomorrow’s opening is crucial for the bulls to take control. Two things tomorrow will decide whether bulls are taking over the bears 1) Opening price 2) Breaking of previous low. If we see the opening tomorrow above 4980 and if todays low i.e., 4956 is not breached than we can bullish for short term. Strategy for tomorrow: If The opening is above 4980 and than NIFTY trades above 4956 than cover your shorts and go long with stop loss of 4950 or else if the low is breached or opening is below 4970 than add shorts to your current positions.  

#120 Nifty Update: PNR Status of Ticket to 4700:" RAC 3 "

Vacation time has started and many of you have booked your tickets ….so has NIFTY!! Your ticket to destination might be in waiting list but NIFTY’s ticket to 4700 is now RAC today which was in waiting list yesterday…That means we have got confirmation today that NIFTY is surely travelling towards 4700 but RAC 3 means we have 3 more hurdles on the way which myt restrict the travelling 1)4980 which has acted as the strong support since last  3 days (closing basis) 2) 4900-4920: Strong support levels on both weekly and monthly level 3) Not a technical reason but a imp one: USDINR chart suggests rupee strengthening ahead. Talking about the last three days, it has been a dramatics on the exchange. First day, we saw a 3 imp level breaking out i.e., triangle brkout, 100 SMA and 200 SMA. Second day we saw a gap down opening and thn last 2 hours saw 135 points recovery after the GAAR postpone to nxt year…but technically it was just a pullback to brkout level which was 200 SMA at 5114 (white line) . Today the final day we saw a heavy selling and all profits gained yesteray were wiped out. All funtdamental supporters and analyst were gvng tgt of 5600 yesterday after the GAAR but technically we got downside confirmation…..But its RAC and yet not confirmed 🙂 …Strategy : Hold your Shorts which i have initiated at 5170….

#119 Nifty Update: "Investors liquidate their position to buy Mangoes "

Mango season is here and i dont find any other strong reason fundamentally tht why we are seeing a sell-off in market. This may be due to the mango lovers gng for mango..hahahaha…But remember Maaza “haar mausam aam”?? ..So guys be in some liquid cash to buy at lower levels in coming months…Anyways coming to the point, it was a “Black Friday” as some may state for the investors on 4th of May. Many expertise  and analyst are of mood that market may bounce back from current levels but study of my technical analysis suggest that we are more biased on the downside for coming 2 expires. As i had mentioned about the descending triangle in last few months we ultimately got breakdown from neckline with Close that to a weekly and daily. Last friday’s close has made many technical analyst eyes wide open. Descending triangle is a bearish signal but this time it was formed after a rally and global markets were positive so we had expected triangle to give bullish breakout which it didnt. Yet WE HAVENT GOT CONFIRMATION of breakout but we can be biased on downside as per Triangle rule but we have seen all indicators turning negative last week. You may see on the daily chart as i have marked that there are 4 gaps which has been left in last rally. We may see atleast first 2 getting filled. But 4700 odd level is a strong downside tgt as its a formula tgt from triangle breakout an we also have the gaps around same level. But as per the retrenchment level 4900-4940 is a strong level for support so i am expecting minimum 4900 as the tgt on NIFTY. 
Stock Markets generally over the world tends to trade in a seasonal cycle which states that a bearish cycle from April-October and bullish from November- March. it generally means that we see a market low in April-October and high in November- March. That has exactly been the case in the markets this here. We saw a bull run upto march, April was consolidation and now month of MAY will lead to some downside unless a strong fundamental reason or some positive parliament outcome. But it does not mean we may see new low but we may witness bearish mood. 
What are positive for the Markets??
Surely there is some positiveness for the long term investors. As you could notice in the chart 100 SMA (red) has given a bullish crossover over 200 SMA (White) which is a buy signal but NIFTY is trading below that averages so be cautious. Fundamentally we have seen some outstanding results coming of domestically which is a good sign for industries. Notice that Consumer utility stocks are giving better result which is indeed the first sign of market recovering from the bottoms. In the US a article suggest that 98 out of 100 Metropolitan cities are witnessing a real estate boom as the finance and prices are at affordable rate then rent. So globally also we are witnessing a spark in household utility spending.  
Short players can go short with Stop loss of 5200
Long players: Long term investors buy 30% of the portfolio at 4900-4950 and rest at 4600 if that level breaks out on downside or at 5200 if we see a bounce back from 4900.

#118 Nifty Update: NIFTY on the Verge after Positive Breakout!!!

In my last post i mentioned that we were in consolidation phase and we expect a breakout very soon!!! Breakout has been confirmed last week and it was strictly to the principles of “Descending triangle”. Technically speaking, we saw a breakout on Wednesday on the upside from the triangle and for confirmation we got three consecutive close exactly above the trendline. Now resistance line has changed his role to support line as you could notice in the chart. Top first circle shows that NIFTY has been closing above trendline and short term moving averages for three consecutive days. Second circle , as i mentioned in last post, is a possible crossover of 100 SMA (red) over 200 SMA (white) after almost 2.5 yrs. So, NIFTY is on verge because traditional rules i.e., triangle breakout and moving crossover are almost signalling long term bullish while indicators have yet not confirmed the bull trend. What to do than?? Strategy as per my knowledge is starting buying longer term investment stocks and add on each dip upto 5200.Keep a stop loss of 5117 if the market goes worst. 1st Target on the upside is 5600 and second 6300 as per the breakout and triangle formula. A lot is based on monday opening. We are expecting a positive opening on Monday as Reliance industries posted results better than expected and some parts was in-line. So go long on NIFTY. Instruments to look for long term are Pharma sector and NIFTYBEES. Anyways will post you guys as soon as we get some more confirmation on the bull side.

#117 Nifty Update: Housefull 3 running successful over INDIA

Confused reading the Headline??? Hahaha… This time its not the Bollywood movie but its the NIFTY chart.  Reason for my name “Housefull” today was as you can notice in the chart the consolidation on NIFTY in the triangle is coming almost to the apex. This calls for a breakout on either side. For the people who arent aware, triangle is a consolidation pattern meaning trend haults on the move and continues the previous move. Our previous move in this case is bullish and as by rule we should witness bull run further. But all the rules are with exception or you can say with a risk. Triangle sometimes gives a reversal sign. Today D subbarao gave 50bps cut but still NIFTY couldnt cut through the triangle on either side. Global markets are mixed with cues on both side so fundamentally we are not able to decided the further move. Technically speaking we have chances of upside breakout at the moment. The indicators which i study have turned their hands towards bulls today. 100 SMA (red line) is approaching 200 SMA (White line) to crossover which is a sight unseen for last 2 years which is a strong bullish sign. Tomorrows session would be the crucial one technically. Our strategy would be to close ur shorts at 5320 on NIFTY which is a breakout point but only go long on confirmation level which is 5350 i.e., a rectangular breakout within the triangle. But look out for the close tomorrow. If the close is below 5300 than gates could open for downside. Add more shorts only below 5170. CAUTION for SAFE TRADERS: This time on markets is too volatile and indecisive so think twice before taking any position or wait for confirmation level. Indian markets always gives second opportunity so never feel left out. Ciao!!!!!!