Major News of the week:
Nifty opened the week at 9908.15, made a high of 9928.2, low of 9792.05 and closed the week at 9915.25 with a gain of 29 points 0.29%). Nifty closed above the previous week high of 9913.3.
Options data for July series indicate highest Call Open Interest is at the strike of 10000 and highest Put build-up has shifted upwards and is at 9800. Last week highest put built up was at 9600/9700 level. Now that shifted to 9800 level and 9900ce unwinded which indicate bullishness of the market.
Global Indices : European stocks headed lower this week. S&P 500 and MSCI World among record-setters. Almost all US market end flat to positive note.
FIIs bought shares worth Rs 1,956.51 crore during the week, as per Sebi's record including the provisional figure of July 21.
Last week we discussed “Looking to the past nifty movement since December 2016, after a 400-500 points upmove usually there could be a correction around 200 points. Daily Oscillators are now in overbought sold. Nifty nearing Trendline channel resistance.”. Nifty hit all time high of 9928.2 on Monday itself and then made a correction of 135 points and hit a low 9792.05 on 18 July.
Nifty made a new high and managed to close above 9900 mark on first day of the week. On the next day Nifty opened gap down and traded red throughout the day and filled gap made on last Thursday,13 July.. Index made first lower low after 11 days. On Wednesday, Nifty managed to hold Tuesday’s low and closed above Tuesday’s high. On Thursday Index made a dark cloud cover bear candle. On Friday Nifty protected DCC low and made a bullish hammer and managed to close above 9900 level on Nifty. Protecting Friday’s low is important for gaining strength for bulls.
In this upmove Nifty / Sensex made three gap ups on daily chart. 1st on 3rd July, 2nd on 10th July and 3rd gap up on 13th Jul. There are three types of gaps : Breakaway gaps, runaway gaps & exhaustion gap. Break-away gap usually occurs at completion of important price pattern and usually signal the beginning of significant market move. So we can consider 3rd July gap as a breakaway gap. 2nd type of gap is runaway gap which indicate the strength of the market. 10th July gap is comes under 2nd type of gap. Final type of gap (exhaustion gap) appears near the end of market move. To qualify exhaustion gap, directional move quickly fades and price turn lower within a couple of days on within a week. When price close under the last gap, then exhaustion gap is confirmed. So to qualify 13th Jul gap as exhaustion gap price should come down and close below the gap. In this case it should close below 9816.1 – 12th Jul close price. Nifty filled the gap, but not closed below it.
Nifty should close above 9928.2 for further upmove, otherwise the present moves seems to be like a double top pattern. Close below 9792 confirms Double Bottom.
- Reliance announcement about Reliance Jio Phone
- Reliance announcement of 1:1 bonus issue of shares
- China’s Second Quarter GDP beats forecasts.
Nifty opened the week at 9908.15, made a high of 9928.2, low of 9792.05 and closed the week at 9915.25 with a gain of 29 points 0.29%). Nifty closed above the previous week high of 9913.3.
Options data for July series indicate highest Call Open Interest is at the strike of 10000 and highest Put build-up has shifted upwards and is at 9800. Last week highest put built up was at 9600/9700 level. Now that shifted to 9800 level and 9900ce unwinded which indicate bullishness of the market.
Global Indices : European stocks headed lower this week. S&P 500 and MSCI World among record-setters. Almost all US market end flat to positive note.
FIIs bought shares worth Rs 1,956.51 crore during the week, as per Sebi's record including the provisional figure of July 21.
Last week we discussed “Looking to the past nifty movement since December 2016, after a 400-500 points upmove usually there could be a correction around 200 points. Daily Oscillators are now in overbought sold. Nifty nearing Trendline channel resistance.”. Nifty hit all time high of 9928.2 on Monday itself and then made a correction of 135 points and hit a low 9792.05 on 18 July.
Nifty made a new high and managed to close above 9900 mark on first day of the week. On the next day Nifty opened gap down and traded red throughout the day and filled gap made on last Thursday,13 July.. Index made first lower low after 11 days. On Wednesday, Nifty managed to hold Tuesday’s low and closed above Tuesday’s high. On Thursday Index made a dark cloud cover bear candle. On Friday Nifty protected DCC low and made a bullish hammer and managed to close above 9900 level on Nifty. Protecting Friday’s low is important for gaining strength for bulls.
In this upmove Nifty / Sensex made three gap ups on daily chart. 1st on 3rd July, 2nd on 10th July and 3rd gap up on 13th Jul. There are three types of gaps : Breakaway gaps, runaway gaps & exhaustion gap. Break-away gap usually occurs at completion of important price pattern and usually signal the beginning of significant market move. So we can consider 3rd July gap as a breakaway gap. 2nd type of gap is runaway gap which indicate the strength of the market. 10th July gap is comes under 2nd type of gap. Final type of gap (exhaustion gap) appears near the end of market move. To qualify exhaustion gap, directional move quickly fades and price turn lower within a couple of days on within a week. When price close under the last gap, then exhaustion gap is confirmed. So to qualify 13th Jul gap as exhaustion gap price should come down and close below the gap. In this case it should close below 9816.1 – 12th Jul close price. Nifty filled the gap, but not closed below it.
Nifty should close above 9928.2 for further upmove, otherwise the present moves seems to be like a double top pattern. Close below 9792 confirms Double Bottom.
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