Outlook for NIFTY for the coming trading sessions

In our previous post on Nifty Outlook,we expected Nifty to move towards 6220 and 6300.Nifty,after slipping towards 6150 levels,came back strongly and tested 6300 after crossing 6220,finally closing around 6260 level for the week.

Nifty Daily Chart
[source : www.icicidirect.com]

Nifty is continuing with its bullish trend.In the process,it again broke out of a bullish triangle at 6230
on a daily chart.This pattern gives much higher target for Nifty in the coming days.

Though  leading indicator Slow Stochastic is showing negative crossover indicating overbought market,market is expected to continue the strong momentum it gained

after taking cues from Exit Polls of 5 state elections

Outlook for NIFTY for the coming trading sessions

In our last post on Nifty outlook,we expected downside targets of 5975 and 5900 for Nifty.Nifty however staged sharp pullback on the back of considerable short covering and closed at 6177 for the week.

Nifty-Triangle Pattern Breakout

On daily chart,Nifty has given breakout (blue circle) above a Triangle chart pattern which is a bullish sign for Nifty in the short-term period.

Outlook for NIFTY for the coming trading sessions

In our last post on NIFTY outlook,we expected Nifty to move higher towards 6150 and 6200 for retracement of 50-62% of the 350 point decline on the back of short covering.Nifty did that and went above 6200 but could not sustain there.Fed tapering news provided the excuse for the profit booking and Nifty fell towards 5975

Outlook for NIFTY for the coming trading sessions

Nifty Daily Chart-Retracement lines

In our last post on NIFTY outlook,we mentioned targets of 6040 and 5980 on the lower side.Continuing the downtrend,Nifty fell in 8 sessions on the trot.Breaching the first support of 6040,Nifty went up to 5975,the next major support.From these levels ,Nifty bounced back and closed above 6050 in the last trading session supported by short covering.

Outlook for NIFTY for the coming trading sessions

Nifty Daily Chart
( source : icicidirect.com )

In our last post on Nifty Outlook, we expected targets of 6350 and 6400 for NIFTY on the basis of strong upward momentum in the market backed by strong FII's flows.Nifty,however,after testing 6300 odd levels faced profit booking and was dragged down towards lower support levels and closed at 6140 on weekly basis.

On the daily chart,Nifty breached and closed below the neckline ( yellow line ) of the Inverse Head & Shoulder Pattern

Outlook for NIFTY for the coming trading sessions

Nifty Daily Chart
(source:www.icicidirect.com )

Nifty is continuing its uptrend on the back of strong up move in large cap heavyweights after breakout above the neckline of the Inverse Head & Shoulder Pattern and continuously trading above the neckline.FII's are on continuous buying spree.

Outlook for NIFTY for the coming trading sessions

Nifty Daily Chart
 ( source : www.icicidirect.com )

In our last post,we talked of target of 6230 and 6345 for Nifty.Nifty moved up to 6250 and retraced back due to profit booking ahead announcement of Credit Policy by RBI this week.RBI action shall decide the further movement for the nifty.

Outlook for NIFTY for the coming trading sessions

Nifty Daily Chart ( source:www.icicidirect.com )

In our last,post we talked of targets 6140 and 6220 for Nifty.In the week,Nifty after slipping towards 6050-6040 levels, staged a strong up move and continuing its uptrend closed at 6189 after touching 6200 level.

Nifty has given a breakout above the neckline of the Inverse Head and Shoulders Pattern with good volumes.

Outlook for NIFTY for the coming trading sessions

In our previous post,Nifty upmove was anticipated towards 6040 or higher and resistance near 6100 level.On Monday Nifty declined towards 5820 and took support there.Continuing with positive momentum,Nifty crossed 6040 and after touching 6107,closed tad below 6100 at 6096.

Fig 1-Nifty chart

    Fig 2-TRIX & Momentum

                                                              

On daily chart,Nifty is in the process of making an Inverse Head and Shoulder Pattern,a trend reversal bullish pattern,the neckline ( orange trendline ) for which coincides with 6160-6170 (  Fig 1 ).If it manages to close and trade above that level with good volumes,it will open higher levels up to 7000 for nifty in future.

On last trading day,Nifty formed a Hammer candlestick on daily chart indicating some resistance at higher level of 6100. With FII's support and positive global markets,nifty is expected to keep maintaining positive trend.In Friday's session , FII's bought index futures worth Rs. 1000 crore and sold index options worth Rs.360 crore.On Nifty chart, TRIX ( Triple Moving Average Crossover ) has turned positive ( middle graph in Fig 2 ) and Momentum is already strong ( lower graph in Fig 2 )

For the coming days,Buy on dips strategy can be adopted .Nifty can be bought on dips towards 6050 and 5970 for higher targets of 6140 and 6220. ( spot levels )  

Outlook for NIFTY for the coming trading sessions

In previous post,we expected downside in Nifty with lower target of 5700 or lower.On monday,nifty started with slide which continued till next trading day and slipped to 5700 on tuesday.Highest put base is placed at 5700 which acted as a good support for the time being.Hence,nifty bounced back and moved towards 5950 before closing just above 5900 for the week.
For the coming trading sessions , nifty is likely to face stiff resistance around its previous resistance area of 5940-5970.The bias or the undertone in the index is positive with supportive FII;s data.In fridays session, FII's bought index futures to the tune of Rs 318 crore with sell figure of Rs 44 crore in stock futures.
On charts,nifty is well above 20 day moving average ( green line ) and 200 day moving average ( orange line ) which are expected to provide support on lower levels for the short-term.Momentum oscillators are in positive territory.Stochastics and RSI are also in buy mode.
Seeing the market momentum and global market scenario,markets are likely to trade positively and if crosses 5970 decisively,it can move towards 6040 or higher.Highest call base has also shifted from 6000 to 6100 which will pose stiff resistance at higher levels.

Outlook for NIFTY for the coming Trading Sessions

For the previous week, Nifty continued to face resistance in 5900-5950 band on the upside.As you can see in fig 1, the upper trend line joining previous highs made by the Nifty gives resistance levels around 5920-5930 for the coming days.

Fig 1

Outlook for Nifty for the coming week

In the past week,nifty staged significant upmove on hopes from newly appointed RBI Governor Raghuram Rajan to uplift the sinking Indian economy and imminent diesel price hike to levels of 5650 after testing lows around 5330 on Syria concerns.
   Nifty has almost achieved the target which was placed around 5650-5680 after the breakout above 5510 levels on September 2, 2013 based mainly on a significant upmove in Bank Nifty from levels of 8700-8800 to 9600-9700 on the back of major movers like AXIS BANK,ICICI BANK,,INDUSIND BANK,YES BANK and PSU heavyweight STATE BANK OF INDIA.
   For the coming week, targets for Nifty being already accomplished and highest call base being present at 5700 call strike,nifty may face stiff resistance near those levels.Highest put base is placed at 5300 strike.Although short-term trend is up and momentum oscillators on positive,the possibility of sideways movement or a correction can not be ruled out.So traders need to be careful building heavy long postions after a 7-8% of move.
     Traders should wait for some correction before entering the markets.In banking space PUNJAB NATIONAL BANK (PNB) can be a good bet for the coming sessions as it has broken above trading range and has closed above those 444-445 levels.Targets could be around 485-490.