Nifty Weekly Analysis for the week ending 25 January 2018

Sensex opened the week at 35614, made a high of 36268, low of 35545 and closed the week at 36050. Thus it closed the week with a gain of 539 points (1.52%). At the same time the Nifty opened the week at 10883, made a high of 11110, low of 10881 and closed the week at 11070. Thus the Nifty closed the week with a gain of 175 points (1.61%).Nifty made an all time high of11110 at the same time Sensex made an all-time high of 36268.

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

1. Indian share markets finished in red snapping a six-day record-setting rally on last session of January expiry in the derivatives segment.  Sensex has formed a small black body with a longer lower shadow, whereas Nifty has formed a pattern almost like Hanging Man.   So protecting Friday’s low is important fo bulls for further upmove.  
2. On the weekly charts, both the indices have formed Opening White body Marubuzo which is confirming existing bull trend.
3. Market continued its rally for eight straight week, conquering new milestones as Sensex made a new record highs of 36,050.54, while Nifty closed at all-time historic high at 11,069.65. 
4. Time wise Indices took 36 days from 6^th December to achieve 1077 points.  This is the highest bullish swing move till December 2016.
5. Important economic event of Union Budget 2018 is scheduled by next week (1st Feb) which is expected to add volatility in Indian Benchmark.
6. Nifty P/E level reached 27.81 on Tuesday.  All-time high of Nifty P/E is 28.47 in 2000.  Same time Sensex P/E ratio reached at 26.34 on Wednesday. All-time high of Sensex P/E is 29.39 in June 2000.    As I mentioned last week Investors and Traders should take a careful approach of trading. 
7. Options data for February series indicate highest Call Open Interest is at the strike of 11200 whereas the highest Put build-up is at the strike of 10500. There is a huge undwinding of Open Interest visible at put option strike 11100.  At the same time there is huge addition of OI seen at Call Option Strike 11100 and 11200.  These indicate bearish undertone of the Market.  
8. Bearish Divergence still persists in RSI. Daily stochastic and RSI in overbought zone. 
9. Global financial markets: Global stock markets ended the week on a positive note.  Stock markets in Asia were mixed
10. On Weekly basis, FII are Buyers in Cash Segment.