Nifty Weekly Technical Analysis for Week Beginning 21 May

By | May 20, 2012

Nifty continued with its down move  and made a low of 4788 but outperformed rest of world markets as we are down only 0.8% WoW basis. Last week as we discussed below 4995 trend remain bearish and Nifty made a high of 4957 and reached to 4788.Click Here to Read the Previous Week Analysis

 

Indian markets are facing the double whammy of rising Indian Rupee as it touched almost 55 odd levels,Life time low with  rising Inflation as April Inflation came at 7.23%Greece the small economy has kept the world markets on its toes on whether it will remain in and out of Eurozone. Greece leaving Eurozone will be Lehman Moment of 2012 and cost run in almost trillion dollars.Greece has declared election on 17 June which gives lot of time to ECB and World Leaders to prepare a contingency plan for Greece Exit.

 

Facebook Listed on NASDAQ on Friday and closed almost at its 38.23 near to its offer price.Facebook net worth is now 104 Billion Dollars.

In simple valuation terms, Facebook’s stock is trading at 105 times its 2011 earnings. This means that in 2011, the company’s profits stood at US$ 1 bn. For any company to justify such valuations, its earnings growth needs to be phenomenally high. How Facebook will capitalise on its 900 m plus user base (and one that is still growing), will definitely be interesting.

Lets jump into Technical.

 

Nifty Hourly Chart

Nifty hourly charts are giving sign of reversals as it is breaking the downward slopping trendline from running from 5300. Close above 50 Hour SMA @4898 will give us the first sign of Bulls taking hold of Nifty.

Nifty Gaps

Nifty has the following gaps so any close below 5000 will lead to gap filling so keep a close eye on the gap levels mentioned below 1 got filled in current week and still 2 are pending.

1 Gap :4641-4676

2 Gap:4744-4772

3 Gap:4879-4905 — Filled

4 Gap:4947-4991 — Filled

 

Nifty Daily Chart

Breakout comes on Daily chart with a close above 4960, and once it closes above 4960 quick rally can be seen towards 200 DMA 5085.

Daily Indicators have started showing positive divergences, but we need a price confirmation with a move above 4960. Divergences are always a mystery to play with but always remember if we get divergences in Higher Time frame more stronger will be the effect of divergences.

Nifty Fibo Chart

As discussed in last week analysis there is a good probability of bounce back near 78.6% retracement and Nifty did give a bounce back from 4780, quiet near to pur Fibo levels of 4767. Now next major resistance will come at 4951 which is 61.8% retracement.

Nifty Weekly Chart

On Weekly chart Nifty is down 0.8% WoW basis but good things for Bulls is it did not closed below the downward slopping trendline. Any move below 4720 will confirm the retest of December low of 4531 and any move above 4960 will see rally till 5085 and 50WSMA@5160. Weekly Indicators are approaching the oversold zone.

 

Nifty Monthly Chart

Monthly charts have seen an Exact bounce back from the lower trendline,Higher time frame should always be given preference as the signals and levels given by them are very strong.

 

Nifty Trend Deciding Level:4898

Nifty Resistance:4957,5020,5085

Nifty Support:4860,4820,4767 and 4720

 

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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5 thoughts on “Nifty Weekly Technical Analysis for Week Beginning 21 May

  1. Bramesh Post author

    Thanks a lot Sir..

    Rgds,
    Bramesh

  2. Bramesh Post author

    Thanks a lot Sir..

    Rgds,
    Bramesh

  3. Chandra

    Hi Sir. this is awesome analysis helping retail investors, especially ppl like me. hats off and thank you very much.

  4. hemandkumar mehta

    very good getting valuable knowledge jay shri krishna

  5. Raj

    Dear Bramesh,

    Thanks for the simplicity and covering all the Time frame for Nifty analysis. I have been a silent follower of your site and have been immensly benifited.

    Planning to join your trading course soon.

    I have clicked on 2 adds on the post to show my respect towards your abalysis.

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    Thanks,
    Raj

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