Nifty Weekly Analysis for the week ending 01 December 2017

On the monthly chart, Sensex opened the month at 33344, made a high of 33866, low of 32684 and closed the month at 33149 with a loss of 64 points (-0.19 %).  At the same time the Nifty opened the month at 10390, made a high of 10490, low of 10094 and closed the month at 10227. Thus the Nifty closed the month with a loss of 109 points -1.1%).

Sensex opened the week at 33641, made a high of 33770, low of 32798 and closed the week at 32833. Thus it closed the week with a loss of 846 points -2.51%). At the same time the Nifty opened the week at 10361, made a high of 10410, low of 10109 and closed the week at 10122. Thus the Nifty closed the week with a loss of 268 points (2.58%)

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

1. On weekly chart, Sensex & Nifty made a biggest bear candle since August 1^st week.. 
2. On Monthly chart, Nifty made a bearish candle.  If Nifty breaks 10094, that will lead to lower high lower low pattern on monthly chart and  result in a change in short term trend according to Dow theory.  Nifty never made a lower low pattern on monthly chart since December 2016. 
3. This week both the indices have breached the Bullish Gap between 33278-33165 for the Sensex and 10268-10232 for the Nifty.  As a result, both Sensex and Nifty are now at the critical Support in the form of Bullish Gap between Sensex 32804-32670 and Nifty 10120-10104. This Bullish Gap has acted as Support and market have closed just above this level.  A break of this Gap will result in the intermediate trend turning down and the Correction will resume.
4. The India VIX index shot up 10 per cent to 14.8 from the previous week’s close of 13, indicating more turbulence in the week ahead.  It is making a rounding bottom like pattern and if it break 15.54 level then more serious fall can happen. 
5. Rising Trend line connecting  June/September candles supports come at  9850.  Once 10094 support breaks next support is at 9850. 
6. In December Indian Benchmark complete 22 months of bull market. Index topped every 2 years and made a good correction after that.  Let us look at the  major reversals, in 1992 (-57%), 1994 (-39%), 1996 (-34%), 1998 (-36%),2000 (-58%), 2002 (-25%), 2004 (-33%), 2006 (-30%), 2008 (-64%), 2010 (-28%),2013 (-14%),2015 (-25%).   So timewise Indian benchmark is nearing its maturity for a correction. 
7. Looking at the Bank Nifty chart, protecting 25119 is crucial.  On breaking this level, fall will continue..       
8. On Daily Chart RSI in oversold region.  Also showing bullish type 2 divergence...  . 
9. Global financial markets: Global market ended mixed.
10. On Weekly basis, FII were sellers in the cash segment. 
11. Options data for December series indicate highest Call Open Interest is at the strike of 10500 whereas the highest Put build-up has shifted lower to 10000. Thus Options data suggests a trading range with resistance at 10500 & support at 10000.   Aggressive open interest addition is seen at the call strike of 10300 and 10400.