The market had a spectacular rally on Diwali and a fallow through was seen in the expiry week. In these two weeks market moved from 7856 to 8350 i.e. around 500 points or 6.5% in only 9 trading sessions. After this humungous rally the market took breather this week. Most of the daily candles were neutral this week, indicating a close fight between bulls and bears. The market consolidation should be bought into on every dip for further gains in coming weeks.
Nifty opened the week at 8348, made a high of 8365, low of 8290 and closed the week at 8337. Thus the Nifty closed the week with a gain of 15 points. It has formed neutral formation on all the three working days of the week and even on the weekly charts. Nifty has formed a small body Spinning Top on Friday; but that seemed to be the case on previous two days also, almost forming a rare Bearish Tri-Star formation. This requires a confirmation in the form of a real black body candle on Monday. On the weekly charts, Nifty have formed Bearish Doji formation. This formation also requires confirmation in the form of black body candle in the next week. Thus next week’s candle formation will be critical for the fate of short term trend.
Last week Nifty left behind a Bullish Rising Gap between 8198-8181 on Friday. This gap will not only act as a support but it can also be interpreted as a Measuring Gap and the target as per Gap Theory falls at 8656. Nifty continues to remain above the short term average of 20dma (8010), medium term average of 50dma (8014) and even above the long term average of 200dma (7215). Thus the trend in the short term, medium term and the long term timeframe remains bullish.
RSI @ 71 has turned overbought and so has the Stochastic oscillator (%K@95). But both of them still continue to show strong bullish momentum. MFI @71 continues to show strength and suggests positive money flow in the market. ADX has improved to 26, which indicates that the uptrend is now gaining strength. Direction Indicators continue in buy mode as +DI remains above –DI. Bollinger Band continues in Buy mode. Except for certain Oscillators which are overbought, majority of the Oscillators are suggesting bullishness in the short term.
Option data for the current series, shows highest Put Open Interest at the strike of 8000 and highest Call build-up has shifted to the strike of 8400. Thus Option data suggests a trading range with support at 8000 and resistance around 8400. On Friday, 8400 Call has seen strong Open Interest buildup which suggests immediate resistance at the level of 8400.
Nifty opened the week at 8348, made a high of 8365, low of 8290 and closed the week at 8337. Thus the Nifty closed the week with a gain of 15 points. It has formed neutral formation on all the three working days of the week and even on the weekly charts. Nifty has formed a small body Spinning Top on Friday; but that seemed to be the case on previous two days also, almost forming a rare Bearish Tri-Star formation. This requires a confirmation in the form of a real black body candle on Monday. On the weekly charts, Nifty have formed Bearish Doji formation. This formation also requires confirmation in the form of black body candle in the next week. Thus next week’s candle formation will be critical for the fate of short term trend.
Last week Nifty left behind a Bullish Rising Gap between 8198-8181 on Friday. This gap will not only act as a support but it can also be interpreted as a Measuring Gap and the target as per Gap Theory falls at 8656. Nifty continues to remain above the short term average of 20dma (8010), medium term average of 50dma (8014) and even above the long term average of 200dma (7215). Thus the trend in the short term, medium term and the long term timeframe remains bullish.
RSI @ 71 has turned overbought and so has the Stochastic oscillator (%K@95). But both of them still continue to show strong bullish momentum. MFI @71 continues to show strength and suggests positive money flow in the market. ADX has improved to 26, which indicates that the uptrend is now gaining strength. Direction Indicators continue in buy mode as +DI remains above –DI. Bollinger Band continues in Buy mode. Except for certain Oscillators which are overbought, majority of the Oscillators are suggesting bullishness in the short term.
Option data for the current series, shows highest Put Open Interest at the strike of 8000 and highest Call build-up has shifted to the strike of 8400. Thus Option data suggests a trading range with support at 8000 and resistance around 8400. On Friday, 8400 Call has seen strong Open Interest buildup which suggests immediate resistance at the level of 8400.
Stock of the week:
Colgate Palmolive
The Stock has given break out of the Flag pole pattern on the weekly charts with good volumes. The pattern target lies at 2100 with the stop loss of 1700. For the short term buy this stock with the stop loss of 1740 on closing basis for the targets of 1825-1875-1918
The Stock has given break out of the Flag pole pattern on the weekly charts with good volumes. The pattern target lies at 2100 with the stop loss of 1700. For the short term buy this stock with the stop loss of 1740 on closing basis for the targets of 1825-1875-1918
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