Archives : NIFTY OVERCOMES BEARISH GAP - 30 11 2018

NIFTY OVERCOMES BEARISH GAP - 30/11/2018.


TREND TURNS POSITIVE.

 

In what turned out to be a decisive move on Thursday, the market exhibited very high level of bullishness and in the process overcame the major hurdle in the form of Bearish Gap between 10754-10843. In the process, both Sensex and Nifty also overcame the long term average of 200dma, thereby turning the trend to Bullish. But both the indices are yet to cross the Trend Reversal level of 36813 for the Sensex and 11089 for Nifty.

 


NIFTY OVERCOMES BEARISH GAP - 30/11/2018.


TREND TURNS POSITIVE.

 

In what turned out to be a decisive move on Thursday, the market exhibited very high level of bullishness and in the process overcame the major hurdle in the form of Bearish Gap between 10754-10843. In the process, both Sensex and Nifty also overcame the long term average of 200dma, thereby turning the trend to Bullish. But both the indices are yet to cross the Trend Reversal level of 36813 for the Sensex and 11089 for Nifty.

 

TECHNICALLY SPEAKING.


Sensex opened the week at 35118, made a high of 36389, low of 34896 and closed the week at 36194. Thus it closed the week with a gain of 1213 points. At the same time the Nifty opened the week at 10568, made a high of 10922, low of 10489 and closed the week at 10876. Thus the Nifty closed the week with a gain of 350 points.

 

On the daily charts, both Sensex and Nifty have formed a Black body Spinning Top, which comes on the back of four consecutive white body candles. On the weekly chart, both the indices have formed a big White body candle, which overcomes the Bearishness of last week’s Bearish Engulfing as this week’s closing is above the high of Bearish Engulfing. Thus daily as well as weekly candlestick pattern study suggests a Bullish bias in the near term.

 

The Market overcame the Strong Resistance in the form of Critical Bearish Gap i.e. between Sensex 35820-35911 and Nifty 10754-10843 and crucial Resistance in the form of 200dma, thereby signalling that the long term trend has turned Bullish and the Bulls are now firmly in-charge and one can expect further upside.

 

The Indices finally breached the Trading Range of last two months i.e. between Sensex 35800-33300 and Nifty 10800-10000, on the upside. This marks end of consolidation and an indication of further upward move which can help the Nifty towards the 11000 mark. On the lower side, Sensex 35000 and Nifty 10500 will act as strong Support.

 

The current upward move can be still termed as a Corrective move of the fall from the top of Sensex 38989 & Nifty 11760 to the low of Sensex 33291 & Nifty 10004. The Corrective levels are placed at Sensex 35468-36140-36813 and Nifty 10675-10882-11089 for the Nifty. Interestingly, both Sensex and Nifty are at the 50% Retracement mark and the current scenario suggests a bullish bias. The indices are now headed to test the 61.8% level of Sensex 36813 and Nifty 11089 which is a Reversal level. If the indices overcome and continue to stay above the trend Reversal level then one can expect the market to challenge the life-high levels.

 

A fall below the Support of Nifty 10450, will see the Correction resuming and the intermediate Correction levels are placed at Sensex 33920-32354-30788 and Nifty 10283-9827-9371. Higher degree Correction levels are placed at Sensex 32688-30742-28796 and Nifty 9875-9293-8710. Thus we have two confluence zones which will act as Support Zones. First Confluence Support Zone is between Sensex 32688-32354 and Nifty 9875-9827. Second Confluence Support Zone falls between Sensex 30788-30724 and Nifty 9371-9293.

 

This week, both the indices have managed to overcome the long term average of 200dma (Sensex – 35406 and Nifty – 10744) as well as the medium term average of 50dma (Sensex – 35235 and Nifty 10610). Both the indices continue to remain above the short term average of 20dma (Sensex – 35298 and Nifty – 10621). Thus the trend in long term, medium term and even the short term has turned Bullish.

 

MACD and Price ROC are both in Buy mode. RSI (62) suggests Bullish momentum. Stochastic Oscillator %K (90) is above %D and hence in Buy mode. ADX (16) suggests that the Down Trend has lost all its strength. Directional Indicators are in a Buy mode as +DI is above –DI. MFI (74) suggests Positive Money Flow. Bollinger Band has given a Buy signal. Thus majority of Oscillators are suggesting a Bullish bias.

 

Options data for December series indicate highest Call Open Interest is at the strike of 11000 whereas the highest Put build-up is at the strike of 10000. Thus Options data suggests a wide trading range with resistance at 11000 & support at 10000.


INDEX LEVELS:


 

S3

S2

S1

CLOSE

R1

R2

R3

Nifty

10557

10645

10774

10876

10975

11078

11185

Sensex

34937

35357

35822

36194

36616

37061

37559


THIS WEEKS RECOMMENDATIONS:


STOCK

CMP

SL

Tgt-1

Tgt-2

Buy Maruti

7661

7531

7859

8063

TorrentPharma

1773

1735

1832

1895

Buy DrReddy

2722

2672

2797

2874

Buy AuroPharma

810

792

837

865

HoneywellAuto

22178

21723

22923

23744


WATCH OUT FOR:

 

Dr Reddy

 

 

 

 

 

Disclaimer : The recommendations made herein do not constitute an offer to sell or a solicitation to buy any of the securities mentioned. No representations can be made that the recommendations contained herein will be profitable or that they will not result in losses. Readers using the information contained herein are solely responsible for their actions. Information is obtained from sources deemed to be reliable but is not guaranteed as to accuracy and completeness.

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