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.
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.
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.
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
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.
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….
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.
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!!!!!!
It was nightmare for all the traders today on the Floor. Indeed it was the Black friday or you may say it proved to be unlucky 13th the Friday. Morning was greeted with below expectations INFY result and worst guidance by the company. Global markets were fairly strong almost 1% while SGX NIFTY was trading near to 5335. Pre-Open clearly suggested that we may see some pressure in the market due to INFY result but global market support would lead the market in positive zone. We saw the same thing happening, after being in negative zone, after 9.30 we saw market again in bullish mode. But as i had mentioned on my twitter @niftybykush 5305 was important resistance and so did NIFTY resisted near to 5306. At that moment investors thought that we were safe from unlucky “13th Friday” and than in just few seconds we saw heavy selling and NIFTY drifted to 5185 from high of 5306 in just 5 mins!!!! OH WHAT THE FUCK?? …….Even i dont know what was the case..But i feel it was the late effect of two major fundamental problem 1) Weak Infy result and 2) Revision of IIP numbers for Jan….How can a government make such a blunder?? FII were investing as they were positive on IIP numbers but that proved false numbers and may be we saw selling on that part today. Technically speaking , as u all can notice on the chart we are trading through a “descending triangle” which is a consolidation pattern and which means prior trend i.e., bull in our case will be back in action on breakout. But the indicator suggests that triangle may prove to be a reversal pattern which is rare but it can be true. If we see 5169 being broken than we can get 4663 on NIFTY. While on positive note we can see 100 may cross over 200 SMA which will be long term bullish and triangle will be given upside breakout at 5330. But taking support of indicators, i would suggest still hold your SHorts which i had recommended with stop loss of 5330. Add more shorts below 5146 and be long above 5360. Till than see ya!!!!!