Nifty Weekly Analysis for Week starting 23 April

By | April 22, 2012

“The ability to accept the many ups and downs of the market is one of the most important skills a trader can have.”

This is an Apt one liner on what happened on Friday at 2:30 PM.  “Flash Crash” happened in NF

  • The Nifty futures crashed over 300 points in afternoon trade, Nifty April futures plunged to a low of 5,000. A total of 51.49 lakh shares were traded between 2.25 pm-2.35 pm.
  • Infosys April futures hit a low of Rs 1,950 at 10.45 am. 67250 Infosys got traded in which it made a low of 1950
  • NSE Officials have denied that it was a fat finger effect or trading mistake by dealer.
  • So it seems its another case of manipulation by Big Boys to cover up there shorts probably formed before the RBI policy
  • Looser in the game were again the retail investor whose Stop losses and Short  Trades got executed at lower levels and they need to pay heavy price.

Nifty Hourly Chart

Nifty Hourly charts has formed double top at 5342 also 3 trend lines drawn are converging at a single point which signify good move is offing. Nifty has closed above its 50 Hourly SMA@5265 and 200 HSMA@5280 which signify bullishness.

Nifty Daily Chart

Its 3 days in a row we have closed above the falling downward trendnline which is a bullish indication. Even on Friday the fall till 5245 got quickly recovered and we closed above the trendline. We can also see the formation of Falling wedge which is again a bullish pattern.  What is stopping market to go up is the 50SMA@5338.

Above 50 SMA Bulls gets stronger and from past 3 days Nifty is trying to cross 50 SMA on closing basis and every attempt is getting failed.

I have discussed range of 5221-5380 on Nifty future in April and same is depicted by above chart. April has been a consolidation month till now. Nifty is just not going anywhere just trading within a range. This kind of moves after Volatile March series we had is very much required to adjust moving averages. Sideways consolidation markets are required to form a firm base before breakout. May has got a nasty history of wild swing and age old adage Sell in May and Go away still holds true.

 

Nifty Fibonacci Chart

Even though we had flash crash in NF,Nifty spot continued to follow the Fibonacci retracements.It made a low of 5245 which was 61.8% retracement of recent move from 5185-5342. Fibo levels do provide important support and resistance levels and always keep them handy during trading hours.

 

 

Nifty Weekly Chart

It has been eventful week with RBI cutting rates by 50 BPS and falsh crash on Friday. All said and Done Nifty formed a bullish engulfing pattern with a close of 1.6%.

Falling wedge pattern is visible in Weekly charts. All we need a close above 5344 for the pattern to get active.

Keep a watch on 50 WSMA as shown in above chart its an important level to watch.See how closely nifty takes support during uptrend and resistane during a downtrend.Flag and Pole pattern is still active in Nifty.

 

Nifty Monthly Chart

Monthly candle is forming and “Inside Month” candle. Break above 5400 or 5178 will provide further trigger to Nifty

 

Nifty Trend Deciding Level:5344

Nifty Resistance:5385,5445 and 5485

Nifty Support :5245,5203,5178 and 5135

 

Let me go by Disclaimer these are my personal views and trade taken on these observation should be traded with strict Sl

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2 thoughts on “Nifty Weekly Analysis for Week starting 23 April

  1. Chandra Mohan Gupta

    As a conclusion of the analysis Nifty can be assumed bullish during coming week as
    * Nifty has closed above 50 HSMA & 200 HSMA,
    * Nifty was able to get for 3 past consecutive days, the closing above the falling downward trend line
    * Formation of Falling wedge on daily & weekly chart
    * On weekly chart, formation of Bullish engulfing pattern
    * Nifty is being traded 50 WSMA

    But what about Friday Crash?
    Is there any possibility to retest 5000NF level again as
    * on 26th April, 2011 NF low was made as 5393.45 against previous day closing of 5886.5 and subsequently in 9 trading days, NF was able to make a low of 5443.55 with a days closing as 5458.4 and
    * 5393.45 level was breached on 23.5.2011 with a low of 5364.75 and having days closing as 5383.45

    Please analyse over this history too and comment please.

    Thanks and regards.

    CM Gupta

  2. damodhar

    SIR WHAT WILL RELIANCE RESULT EFFECT ON NIFTY & MARKET ON MONDAY MORNING &WHICH SHORTS WHERE COVERED AT FLASH CRASH PARTICULAR ANY STOCK OR ONLY NIFTY FUTURES THANKS

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