Key events during the week:
Economic data that was released on Thursday showed that India’s GDP has dipped to 5.7 percent, y/y, in Q1 FY2018
On the monthly chart, Nifty opened the month at 10101, made a high of 10137.85, low of 9685.55 and closed the week at 9917.9 with a loss of 159 points (1.6 %). This is the highest monthly loss since December 2016.
Nifty opened the week at 9907.15, made a high of 9983.45, low of 9783.75 and closed the week at 9974.4 with a gain of 117.35 points (1.18%). Nifty and Sensex made 3rd straight weekly gains.
On daily chart, 3rd consecutive bull candle which is first time since 2nd August 2017. After made a low of 9685.55 on 11th August, Nity made a 58% retracement (262 points) and failed to move up further and made fall of 208 points which is almost 80% fall to 262 point upmove. Market stared to make contracting after that which looks similar to a bearish flag. Market made another attempt to move up and made a high of 9926 on 28th August. On expiry day of August Nifty made a hammer type candle and closed above contracting triangle. On Friday Nifty broke important resistance of 9948 and closed well above it.
I have mentioned in my post dated 13th August, “…….Market closed near 9700 level which is a strong support for Nifty . In the upmove 9700 acted as a strong resistance during June 2017. On 6th June Nifty made an ELB candle by touching high of 9709.3. On 22 June Nifty made another attempt and failed to move above June 6 ELB candle. On 10th July Nifty made a hammer type candle and well closed above 9700 level. As a rule strong resistance become strong support. At the same time, 61.8%-66% retracement of July – August Rally is placed around 9700 level….. Among oscillators, RSI, stochastic & KST are currently poised in oversold territory in daily chart…..”
Looking at the present scenario, Now Nifty stands at important retracement resistance level of 66%. It took 3 weeks time to retrace 66% retracement against one week fall. In a strong bull market should retracement in faster time. Nifty to close well above this level for further upmove.
Interestingly when Nifty broke the important resistance of 9948, Sensex not able to break the resistance of 31937.51. Sensex should close above31937.51 for further upmove.
While Nifty retraced above 61.8% level Sensex retraced only 50%level. Sensex need to move above 66% level for further upmove.
For Nifty staying above 9784 is crucial for further upmove. Once Nifty break Friday’s high 9983.45, next strong resistance comes around 10,046 – 10088 level.
Economic data that was released on Thursday showed that India’s GDP has dipped to 5.7 percent, y/y, in Q1 FY2018
- Global financial markets are closed in positive note.
- Weekly basis, FII were buyers in the cash segment
- Options data for September series indicate highest Call Open Interest remains at the strike of 10000 whereas the highest Put build-up is at 9700. Thus Options data suggests a trading range with resistance coming at 10000 & support at 9700.
- August was a high volatile month compared to previous three months. Vix peaked to 15.54. Then cooled off sharply and closed at 11.95. On weekly chart Vix closed at11.68.
- On daily chart, MACD made bullish cross over and Price RSI also look positive.
On the monthly chart, Nifty opened the month at 10101, made a high of 10137.85, low of 9685.55 and closed the week at 9917.9 with a loss of 159 points (1.6 %). This is the highest monthly loss since December 2016.
Nifty opened the week at 9907.15, made a high of 9983.45, low of 9783.75 and closed the week at 9974.4 with a gain of 117.35 points (1.18%). Nifty and Sensex made 3rd straight weekly gains.
On daily chart, 3rd consecutive bull candle which is first time since 2nd August 2017. After made a low of 9685.55 on 11th August, Nity made a 58% retracement (262 points) and failed to move up further and made fall of 208 points which is almost 80% fall to 262 point upmove. Market stared to make contracting after that which looks similar to a bearish flag. Market made another attempt to move up and made a high of 9926 on 28th August. On expiry day of August Nifty made a hammer type candle and closed above contracting triangle. On Friday Nifty broke important resistance of 9948 and closed well above it.
I have mentioned in my post dated 13th August, “…….Market closed near 9700 level which is a strong support for Nifty . In the upmove 9700 acted as a strong resistance during June 2017. On 6th June Nifty made an ELB candle by touching high of 9709.3. On 22 June Nifty made another attempt and failed to move above June 6 ELB candle. On 10th July Nifty made a hammer type candle and well closed above 9700 level. As a rule strong resistance become strong support. At the same time, 61.8%-66% retracement of July – August Rally is placed around 9700 level….. Among oscillators, RSI, stochastic & KST are currently poised in oversold territory in daily chart…..”
Looking at the present scenario, Now Nifty stands at important retracement resistance level of 66%. It took 3 weeks time to retrace 66% retracement against one week fall. In a strong bull market should retracement in faster time. Nifty to close well above this level for further upmove.
Interestingly when Nifty broke the important resistance of 9948, Sensex not able to break the resistance of 31937.51. Sensex should close above31937.51 for further upmove.
While Nifty retraced above 61.8% level Sensex retraced only 50%level. Sensex need to move above 66% level for further upmove.
For Nifty staying above 9784 is crucial for further upmove. Once Nifty break Friday’s high 9983.45, next strong resistance comes around 10,046 – 10088 level.
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