NIFTY-Weekly Outlook-Venkat's Blog

The past week saw a continuation of the control by the bulls. In spite of a truncated week the Index managed to close near the high of the week which indicates that the market looks for some more gains and the sentiments are positive. It remains to be seen if this enthusiasm would continue and the Index attempts 18k.

A few observations from the weekly charts are:

• Weekly charts suggest that
  The index moved in a range of 255 points viz. between 17597 and 17842
  The oscillators of different time frames are showing mixed signals
  The Index has crossed the top of the long term trend line
  Option open interest to drive the direction of the market
  
  

Expected scenarios for the ensuing week

*Index may find supports at 17720, 17610,16480 and the index could face resistances at multiple levels viz. 17840, 17920, 18030
Expected to remain in the range of 17480-18030 and any close outside the range requires re-assessment of risk
Additional interesting observations
The observations made in the previous blog
Daily close above will trigger more 17670 stops and the target would be 17830 and this target has been achieved
The Index has stayed above the long term trend line
There had been multiple Gaps created during the up move (These are for quick reference as these are risk zones for sharp moves)
17126-17221(newly created gap)
16650-16770 (far away for now)
16360-16560 (far away for now)

Final Note

*Third bull candle in the weekly charts with a closing near the highs can be considered as a bullish sign
It is to be noted that the index has crossed the Mid BB on the monthly chart and well above 200 DMA @17557
The Index has crossed the top of the long term trend line
The daily chart shows a steep upward channel with top at 17840-70 range
This week is crucial to judge if a new trend is emerging towards attempt of earlier peaks or reverse after a short term gain
The quick gains made in the last three weeks in spite of the turmoil in the Banking sector and uncertainty in the growth prospects of major economies is a cause of concern
Market appears to be betting on the hypothesis that the interest rates are peaking and possibly expecting a pause instead of a hike
We are entering in to another crucial week and crucial range
Most likely scenario would be that the bulls attempt to enter 18K range provided we see a daily close above 17830 with the target at 18170. If the attempt fails, then we may see a consolidation between 17480 & 18030

#Stay Safe

Disclaimer: The views expressed here are personal and not connected to SYFX Treasury Foundation. The views are for learning and reference purpose only.