Nifty Weekly Analysis for the week ending 17 November 2017

Sensex opened the week at 33397, made a high of 33520, low of 32684 and closed the week at 33343. Thus it closed the week with a gain of 28 points (0.08%).  . At the same time the Nifty opened the week at 10322, made a high of 10344, low of 10094 and closed the week at 10284. Thus the Nifty closed the week with a loss of 38 points (-0.37%)

Let us discuss few observations on last week Indian benchmark movements. 

1. Last week we have discussed “Nifty corrected 237 points and Sensex corrected 758 points in 4 days.   In previous Correction from 19 Sept. to 28 September, Nifty corrected 491 points and Sensex corrected 1442 points in 7 days.   Correction in August also took 452 point fall in Nifty and 1558 point in Sensex in 7 days .   So if it take same magnitude of previous correction Nifty may move down up to 10000 level  and Sensex may correct up to 32300-32400 level.”.   Timewise Nifty and Sensex took same as previous corrections.  But on pricewise Nifty and Sensex not fell that much.  Nifty and Sensex arrested its fall at 10094 / 32684 level which is almost 50% retracement of upmove from 28 September from 6^th November.  
2. Holding 50% Fibo level indicate strength of the market.   Protecting Wednesdays low of 10094 / 32684 is important for Nifty and Sensex for further upmove.  
3. In two days Nifty retraced 63% and Sensex retraced 71% of 7 days fall indicate bullishness.
4. Nifty closed well above 10 day moving average.   Nifty should  close above 20 day EMA for further upmove.     
5. On Weekly Chart, both Sensex and Nifty made a hammer type candle which also indicate bullishness. As per the candlestick theory, the hammer is a significant bottom reversal pattern and is formed at lows after a reasonable declines.
6. On daily candle, on Friday Nifty and Sensex made a gap up opening but not able to sustain above the opening price, and thus it made a bearish closing.   In order to gain the bullish momentum both Indices should close well above Friday’s  high. 
7. Looking at the Bank Nifty chart, Bank Nifty retraced its fall entirely and made a new record high of 25925.            
8. Divergence always gives a clue.   Last week we have discussed type 2 divergence visible in Oscillators.  On Daily Chart, Stochastic made a bullish crossover. 
9. Global financial markets: Global financial markets ended the week on a mixed note.On Weekly basis, FII were sellers in the cash segment. 
10. Options data for November series indicate highest Call Open Interest is at the strike of 10500 whereas the highest Put build-up is at 10000. Thus Options data suggests a trading range with resistance coming at 10500 & support at 10000.   There is a huge unwinding at 10200 Call Option and huge addition of Open Interest at 10300 Put Option, which indicate bullishness of the market.