Nifty Weekly Analysis for the week ending 2 June 2017

Key Points:

•           World Indices made  fresh record closure on Positive US Manufacturing and Employment data
•           Sensex made 4th consecutive weekly bullish candle since Dec 2016
•           Nifty / Sensex made 5^th consecutive monthly bullish candle since Dec 2016

On the Monthly Chart Nifty opened the month at 9339.85, made a high of 9649.6, low of 9269.9 and closed the month at 9621.25.  Thus it made a monthly  gain of 317 points (3.4%).  Nifty / Sensex made 5^th consecutive monthly bullish candle and made fresh all-time high in May. Nifty given 22% return since Dec. 2016.

Nifty opened the week at 9560.05, made a high of 9673.5, low of 9547.7  and closed the week at  9653.5. Thus it closed the week with a gain around 58 points (0.6%).  Sectorally, the top gainers were the Pharma, Auto, FMCG and Cement indices. The top losers were the Capital goods, Power, Telecom and Realty indices. Sensex made 4^th consecutive weekly bullish candle.  This is the first time Sensex making  4 consecutive weekly bull candle from December 2016.

First day of the week, Nifty made another record high and end at a fresh closing high.  Nifty made  the 4th consecutive bull candle on Tuesday 30^th May.  4 is the Maximum number of consecutive bull candle made by Nifty from 2016.   So it obeys that and made a bear candle on 5^th day but maintained higher low.  On 1^st day of June Nifty made lower low, but didn’t break 30 May low.  On 6^th June Nifty made record closing at 9653.5 and made a doji in the upper end of channel line.

In the earlier rally from March 2016, on first 5 months Nifty  made 1813 points and on the current rally from December 2016, Nifty made 1727 points, short of 85 points.  So it is almost achieved price wise. Earlier rally from March 2016 long for 6 months.  So if it achieve price wise compared to earlier rally Nifty will reach in a price target of 10037 level. As the monthly/weekly/daily oscillators are in overbought zone, it seems difficult to achieve a target of 10000 level. 

Thus considering daily / weekly / monthly candle stick patterns suggest a bullish bias in the near term.

Indiavix increased to 11.76% from 10.86% last month, indicating a rise in volatility expectations as the markets rallied to new life highs.  Indivix made a low of 8.84% last month, which is the lowest from 2009.

Options data for June series indicate highest Call Open Interest is at the strike of 9700 and highest Put build-up is at 9400. 

Upcoming Major Event :

RBI Monetary Policy Review meeting on June 07th