Nifty Weekly Technical for Week Starting 31 Oct

By | October 30, 2011

Last week was a Big Bang Diwali fireworks happening on Dalal Street. Nifty after 10 Weeks of Consolidation broke the 5169-4720 range and and After breaking the range with support of global market we are trading back to 5400 Levels.

Many of Traders are Struck with shorts around 5150-5200 Levels and were left surprised with 150 Points gap up which happened on Friday. I would like to share Few of my personal observation How to trade during such scenarios where you are left with almost nil alternatives.

1. Always be flexible and open minded during trading you will be doing 1000 of trades and loss in 1 trade is not end of world.

2. Protecting your capital is the first responsibility of trader which means SL is must and in Such Huge gap up best is to Exit position in Loss and than Look forward for next oppurtunity.

3. Never Indulge in Revenge Trading — By revenge Trading I mean is you just reverse your position and are in a Hurry to cover your Loss. Never Trade with impatience.

4. Golden Rule NO SIGNAL= NO TRADE

5. Markets are forever, if you do not have capital you will never be able to participate in market and trade.

Lets check the Technical of Nifty for Coming Week.

Nifty Hourly

On Hourly charts gap from 5232-5320 is still left unfulfilled. On Higher End we will face resistance at 5435 and 5467 based on Hourly charts.

Hourly indicators are highly overbought and correction till 5232 will be healthy for the market for next upmove which will lead us back to 5600 odd levels.

Nifty Daily

On Daily Charts as shown clearly the gap of 5232-5320 is left untouched. These gaps needs to be filled and a trade below 5320 will start the gap filling process.

Nifty has broken 10 Weeks of consolidation and hence do not accept market to fall in near future. Till nifty does not move below 5200 Use all DIPS to Buy the market.

I would be a Buyer of Dips rather than Seller at Rise as technicals of Nifty have changed and double Bottom scenariofrom 4720  is playing out right now.

Nifty has seen a Rally from low of 4720 to 5400 in matter of 17 trading session ie a rally of 672 points.

The First leg of rally from 5141-4728= 413 points Than Nifty corrected till 5038

Second Leg of rally target come to 5038+413 = 5451

If we draw the trendline also 5470  comes as the trendline resistance.

Also 200 DMA@5410 which is again the dividing line between Bulls and Bears

Nifty Weekly

On Weekly charts we have seen a 6.2% and it got stronger as soon as we broke out above 5169. Breakout trades always have a significance and should never be ignored if its happening after 10 Weeks of consolidation.

Trend lineResistance come at 5470 in above chart.

 

If we take the higher time frame in Weekly charts we see trendline resistance at 5450 which coincides with our target of 5451.

Next week is Fed meeting in USA on Wednesday and I accept some profit booking but as said use dips to buy market or Short near the resistance of 5450-70 with sl of 5500 as this trade provides a good Risk to reward ratio.

 

Nifty Monthly

Tomorrow ie. 31 Oct Will be Last trading day for October month and Nifty is up 8.4% in October Month. 5470-80 again comes as the trendline resistane based on Monthly chart.

5450-70 should be a potential resistance based on Both Weekly and Monthly charts.This level can be used to take short trade with Strict Sl of 5500.

 

Nifty Trend Deciding Level:5409

Nifty Resistance:5451,5484,5511 and 5552

Nifty Support:5320,5272,5232 and 5169

 

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3 thoughts on “Nifty Weekly Technical for Week Starting 31 Oct

  1. pratik

    sirji according to my study 5440-5445 is the biggest hurdle for the nifty and tomorrow morning it will touch. if it trade above 200 dma and also trade above 5445 than next level will be 5485-93. lets see what happen tomorrow.

  2. gopal karwa

    brameshji
    good analysis
    5500 sl should be on closing basis or screen basis 🙂

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