After 3 weeks of downturn, no signs of a turnaround yet. But the fall may get arrested.Let us start with the week gone by.On 7th May we said, the "Nosedive starts", the Nifty opened lower with a down gap of almost 70 points, went lower, and then rallied on the news of GAAR clarifications. Although the Bulls never were able to 200 DMA levels and the Nifty closed at 5114 with a gain of a mere 27 points.On 8th May, we reiterated our reading and suggested, "The trend is still downwards" , the Nifty opened flat at 5115, and then nosedived straight to 4984 before closing at 5000. That day, the Nifty not only gave up all the gains of the previous trading session, but lost more by closing a whopping 114 points down.On 9th May, we had said, "Bears stamp their authority", and the Nifty again lost another 25 valuable points in a whipsawing trading session that saw a high of 5017 and a low of 4956. On that day, it became clear that Bulls were not able to sustain any rallies, and that the Bears were really stamping their authority by now.On 10th May, we had suggested that "The Nosedive may resume", however, we got a pause on that day, when the Nifty after opening with a small gap up on the back of positive global cues, rallied about 50 points to 5040 and then slipped down below to 4950 before closing at 4966.Then on 11th May, we saw that the supports were weakening, and suggested that to our readers of this blog. The Nifty on the last day of the week, the Nifty again opened with a gap down, rallied till the previous day's close, and then closed at the week's low levels.Overall, we saw a bearish week, that has left many a traders wondering, what are the clues for the next week. We try to unravel this mystery in the following technical analysis.1) The Elder Ray readings : On the weekly basis, the Bull Power has reduced from +56 to -56 whereas the Bear Power has increased from -153 to -275, indicating that as the Bulls have just come into the negative there could be some more downward move possible, while the Bears are gaining momentum. For the next week, the Bulls need to overcome 5145 to return back to their safe zone, whereas the Bears need to breach 4860 to maintain their downward momentum.
2) On a weekly basis, the Nifty is trading below all its key EMAs and below its 50 and 100 DMAs. It is however, trading above its 200DMA which is currently at 4815. This could be a support level, the market can look forward to.
3) In the above chart, the volumes have increased in the last week's fall on the Nifty, indicating sustenance of the down move. The weekly MACD is still in the positive, but has started falling off, indicating that a major down side can start from here on. The ADX too, is suggesting of a nascent trend forming and gaining momentum in the downward direction.
4) Overall, all the indicators are threatening of another set of lower levels to be seen on the Nifty in the coming week. However, strong support can emerge around 4800 with strong resistance to any up move at 5070 levels.
5) Considering the above, our trading plan for the week is as under.
a) Below 4910, we will open fresh short positions with a SL of 4950 and a target of 4810.
b) Above 4955, we will open fresh long positions with a SL of 4925 and a target of 5055.
c) Around 5055, we will open fresh short positions with a SL of 5075 and targets of 4910, 4855 and 4810.
d) Around 4810, we will open fresh long positions with a SL of 4780 and targets of 4910, 4955 and 5055.
Happy Trading !!! For cash market recommendations see our Daily Pre Market calls on NSE
After 3 weeks of downturn, no signs of a turnaround yet. But the fall may get arrested.
Let us start with the week gone by.
On 7th May we said, the "Nosedive starts", the Nifty opened lower with a down gap of almost 70 points, went lower, and then rallied on the news of GAAR clarifications. Although the Bulls never were able to 200 DMA levels and the Nifty closed at 5114 with a gain of a mere 27 points.
On 8th May, we reiterated our reading and suggested, "The trend is still downwards" , the Nifty opened flat at 5115, and then nosedived straight to 4984 before closing at 5000. That day, the Nifty not only gave up all the gains of the previous trading session, but lost more by closing a whopping 114 points down.
On 9th May, we had said, "Bears stamp their authority", and the Nifty again lost another 25 valuable points in a whipsawing trading session that saw a high of 5017 and a low of 4956. On that day, it became clear that Bulls were not able to sustain any rallies, and that the Bears were really stamping their authority by now.
On 10th May, we had suggested that "The Nosedive may resume", however, we got a pause on that day, when the Nifty after opening with a small gap up on the back of positive global cues, rallied about 50 points to 5040 and then slipped down below to 4950 before closing at 4966.
Then on 11th May, we saw that the supports were weakening, and suggested that to our readers of this blog. The Nifty on the last day of the week, the Nifty again opened with a gap down, rallied till the previous day's close, and then closed at the week's low levels.
Overall, we saw a bearish week, that has left many a traders wondering, what are the clues for the next week. We try to unravel this mystery in the following technical analysis.
The Nifty breached lows for 4 consecutive days. Signs of weakening supports.As discussed yesterday, the nosedive resumed, after a initial rally in the Nifty that was unable to overcome 5040, the Nifty after breaking 5010, also breached the previous day's low and formed a new low at 4950 and closed at 4966. Today being a weekly close, the Nifty may see some intraday swings, but the downward acceleration may continue if 5040 is not overcome again and if 4950 gets breached.1) The Elder Ray readings : Bull Power increases from -125 to -77 Bear Power reduces from -184 to -165, indicating that the Bears are still the driving force behind the markets, in-spite of their slight loss in momentum. For today the Bulls need to overcome 5110 to return to safety whereas the Bears need to breach 4930 to maintain their downward momentum.2) The Nifty is trading well below its key EMAs and its key DMAs. 3) The stochastics are deeply in the oversold zone.4) In the above chart, the volumes have depleted in yesterday's trade, indicating lack of participation. The MACD is falling away showing a downward divergence. The ADX is also suggesting the strengthening of the down move. The Parabolic SAR continues to hold out its sell signal.5) Considering the above, our trading plan is as under.a) Around 5015, we will open fresh short positions with a SL of 5050 and a target of 4930. We will add to these short positions only below 4910.b) Around 4920, we will open fresh long positions with a SL of 4890 and a target of 4985. We will add to these long positions only above 5050.c) We will observe 4985 to 5015 as "No trading zone" for the day.Happy Trading !!! For cash market recommendations see our Daily Pre Market calls on NSE
The Nifty breached lows for 4 consecutive days. Signs of weakening supports.
As discussed yesterday, the nosedive resumed, after a initial rally in the Nifty that was unable to overcome 5040, the Nifty after breaking 5010, also breached the previous day's low and formed a new low at 4950 and closed at 4966. Today being a weekly close, the Nifty may see some intraday swings, but the downward acceleration may continue if 5040 is not overcome again and if 4950 gets breached.
1) The Elder Ray readings : Bull Power increases from -125 to -77 Bear Power reduces from -184 to -165, indicating that the Bears are still the driving force behind the markets, in-spite of their slight loss in momentum. For today the Bulls need to overcome 5110 to return to safety whereas the Bears need to breach 4930 to maintain their downward momentum.
2) The Nifty is trading well below its key EMAs and its key DMAs.
3) The stochastics are deeply in the oversold zone.
After a brief pause yesterday, the Nosedive for the Nifty is about to resume soon.Yesterday, we had suggested that the Bears have stamped their authority on the Nifty, and as suggested, the Bears opened the Nifty with a gap down, and any rally was quickly sold off in yesterday's session. Today, given the global cues, the nosedive is likely to continue.1) The Elder Ray readings : Bull Power reduces from -49 to -125 Bear Power reduces from -185 to -184, indicating that though the Bears have just about maintained their momentum, the Bulls have lost lots of ground in yesterday's trade. This pause, indicates that the down trend may resume sooner rather than later now.2) The Nifty is trading well below its key EMAs and its key DMAs. The 8EMA is now below the 200DMA, which indicates further weakness on the Nifty.3) The stochastics are deeply in the oversold zone. However, it must be noted that with the rising momentum on the ADX, the stochastics should be read as a confirmation rather than as a reversal indicator.4) In the above chart, the volumes have remained stagnant while the Nifty has also remained stagnant, albeit at lower levels. The MACD has now fallen away, and is threatening to fall even more. The ADX is now clearly showing gain in the downtrend momentum. The Parabolic SAR continues with its sell signal.5) Considering the above, our trading plan for the day is as under.a) Below 5010, we will open fresh short positions with a SL of 5040 and a target of 4910. We will add to these short positions only below 4890.b) Around 4915, we will open fresh long positions with a SL of 4890 and a target of 4980. We will add to these long positions only above 5040.Happy Trading !!! For cash market recommendations see our Daily Pre Market calls on NSE
After a brief pause yesterday, the Nosedive for the Nifty is about to resume soon.
Yesterday, we had suggested that the Bears have stamped their authority on the Nifty, and as suggested, the Bears opened the Nifty with a gap down, and any rally was quickly sold off in yesterday's session. Today, given the global cues, the nosedive is likely to continue.
1) The Elder Ray readings : Bull Power reduces from -49 to -125 Bear Power reduces from -185 to -184, indicating that though the Bears have just about maintained their momentum, the Bulls have lost lots of ground in yesterday's trade. This pause, indicates that the down trend may resume sooner rather than later now.
2) The Nifty is trading well below its key EMAs and its key DMAs. The 8EMA is now below the 200DMA, which indicates further weakness on the Nifty.
3) The stochastics are deeply in the oversold zone. However, it must be noted that with the rising momentum on the ADX, the stochastics should be read as a confirmation rather than as a reversal indicator.
4) In the above chart, the volumes have remained stagnant while the Nifty has also remained stagnant, albeit at lower levels. The MACD has now fallen away, and is threatening to fall even more. The ADX is now clearly showing gain in the downtrend momentum. The Parabolic SAR continues with its sell signal.
5) Considering the above, our trading plan for the day is as under.
a) Below 5010, we will open fresh short positions with a SL of 5040 and a target of 4910. We will add to these short positions only below 4890.
b) Around 4915, we will open fresh long positions with a SL of 4890 and a target of 4980. We will add to these long positions only above 5040.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
As the Nifty gives up all the gains in one day, the Bears have stamped their authority.Yesterday, we had suggested that the trend was still downwards, and the Nifty after opening flat, got resisted at the 200 DMA and gave up all the gains made on the previous day, to close at 5000. Today, given the global cues, the Nifty may open with a small gap down, but may grind within a 100 point range below 5035.1) The Elder Ray readings : Bull Power increases from -72 to -49 Bear Power reduces from -209 to -186 indicating that though the Bears won the last round, they have actually lost momentum. However the Bulls have no momentum going their way at all. This gives credence to the theory that the Nifty may grind for a while. For today, the Bulls need to overcome 5170 to regain their lost grounds, whereas the Bears need to breach 4970 to maintain their momentum.2) The Nifty is trading well below its key EMAs and key DMAs.3) The stochastics are well in the oversold zone now.4) In the above chart, the volumes have decreased in yesterday's fall, indicating that a small bounce back cannot be ruled out. The MACD has fallen away as feared yesterday. The ADX is now signalling a gain in the trend momentum that is favoring the Bears. The Parabolic SAR is continuing with its sell signal.5) Considering the above, our trading plan for the day is as under.a) Below 5035, we will open fresh short positions with a SL of 5055 and a target of 4935. We will add to these short positions only below 4915.b) Above 4940, we will open fresh long positions with a SL of 4915 and a target of 5000. We will add to these long positions only above 5055.Happy Trading !!! For cash market recommendations see our Daily Pre Market calls on NSE
As the Nifty gives up all the gains in one day, the Bears have stamped their authority.
Yesterday, we had suggested that the trend was still downwards, and the Nifty after opening flat, got resisted at the 200 DMA and gave up all the gains made on the previous day, to close at 5000. Today, given the global cues, the Nifty may open with a small gap down, but may grind within a 100 point range below 5035.
1) The Elder Ray readings : Bull Power increases from -72 to -49 Bear Power reduces from -209 to -186 indicating that though the Bears won the last round, they have actually lost momentum. However the Bulls have no momentum going their way at all. This gives credence to the theory that the Nifty may grind for a while. For today, the Bulls need to overcome 5170 to regain their lost grounds, whereas the Bears need to breach 4970 to maintain their momentum.
2) The Nifty is trading well below its key EMAs and key DMAs.
3) The stochastics are well in the oversold zone now.
Although the Nifty closed well above its lows yesterday, the trend is still down.As discussed yesterday, the Nosedive on the Nifty started, almost at the open, with the Nifty opening with a huge gap down, and then recovering in the later half, just to close the gap. Our plan b said "Around 4970, we will open fresh long positions with a SL of 4960, and a target of 5100", and the market obliged. The technicals are still pointing towards a down move gathering momentum.1) The Elder Ray readings : Bull Power reduces from -33 to -72 Bear Power increases from -140 to -209, indicating that the Bears are still in the drivers seat, and a down move is more likely. For today, the Bulls need to overcome 5185 to get into their safe zone, where as the Bears need to breach 4990 again to retain their downwards momentum.2) The Nifty is trading well below its key EMAs and its key DMAs, yesterday's pullback got arrested at 5125 which is the 200 DMA at present. Resistances to any up move lie at 5145 and 5173.3) The stochastics are in the neutral zone, and are very near to the oversold zone.4) In the above chart, the volumes have remained stagnant. The MACD is falling away. The ADX is now indicating gathering of momentum to the trend and the direction of the trend being downwards. The Parabolic SAR is continuing with its sell signal.5) Considering the above, our trading plan for the day is as under.a) Below 5145, we will open fresh short positions with a SL of 5175 and a target of 5040. We will add to these short positions only below 5010.b) Above 5075, we will open fresh long positions with a SL of 5045, and a target of 5125. We will add to these long positions only above 5175.c) Below 5075, the trend is downwards. We will look out for opportunities to go long only above 5075.Happy Trading !!! For cash market recommendations see our Daily Pre Market calls on NSE
Although the Nifty closed well above its lows yesterday, the trend is still down.
As discussed yesterday, the Nosedive on the Nifty started, almost at the open, with the Nifty opening with a huge gap down, and then recovering in the later half, just to close the gap. Our plan b said "Around 4970, we will open fresh long positions with a SL of 4960, and a target of 5100", and the market obliged. The technicals are still pointing towards a down move gathering momentum.
1) The Elder Ray readings : Bull Power reduces from -33 to -72 Bear Power increases from -140 to -209, indicating that the Bears are still in the drivers seat, and a down move is more likely. For today, the Bulls need to overcome 5185 to get into their safe zone, where as the Bears need to breach 4990 again to retain their downwards momentum.
2) The Nifty is trading well below its key EMAs and its key DMAs, yesterday's pullback got arrested at 5125 which is the 200 DMA at present. Resistances to any up move lie at 5145 and 5173.
3) The stochastics are in the neutral zone, and are very near to the oversold zone.
4) In the above chart, the volumes have remained stagnant. The MACD is falling away. The ADX is now indicating gathering of momentum to the trend and the direction of the trend being downwards. The Parabolic SAR is continuing with its sell signal.
5) Considering the above, our trading plan for the day is as under.
a) Below 5145, we will open fresh short positions with a SL of 5175 and a target of 5040. We will add to these short positions only below 5010.
b) Above 5075, we will open fresh long positions with a SL of 5045, and a target of 5125. We will add to these long positions only above 5175.
c) Below 5075, the trend is downwards. We will look out for opportunities to go long only above 5075.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
As the much tested lows got broken, the Nifty is about to nosedive from now on.In our last post, we had suggested that the Nifty was about to test the range lows, and those tests failed almost readily and immediately, and the Nifty then traded much below those 5130 levels and closed with a huge loss at 5088. Today, given the global cues, the Nifty is likely to open gap down and stay down for most of the trading session.1) The Elder Ray readings : Bull Power reduces from -14 to -33 Bear Power rises from -50 to -140, indicating that the Bears are in full control of the Nifty now, and that the Bulls will have a tough time ahead. For today, the Bulls need to overcome 5200 to regain their lost territory, whereas the Bears need to breach 5060 to maintain their downwards momentum.2) The Nifty is now trading well below all its key EMAs and all its key DMAs.3) The stochastics are in the neutral zone and are pointing downwards.4) In the above chart, the volumes have increased in last session's fall on the Nifty, indicating sustenance of the downward momentum. The MACD has started to fall now, and the ADX is also suggesting rising momentum for the downward move. The Parabolic SAR continues with its sell signal.5) Considering the above, our trading plan for the day is as under.a) Below 5080, we will open fresh short positions with a SL of 5095 and a target of 4980. We will add to these short positions only below 4955.b) Around 4970, we will open fresh long positions with a SL of 4960, and a target of 5100. We will add to these long positions only above 5120.Happy Trading !!! For cash market recommendations see our Daily Pre Market calls on NSE
As the much tested lows got broken, the Nifty is about to nosedive from now on.
In our last post, we had suggested that the Nifty was about to test the range lows, and those tests failed almost readily and immediately, and the Nifty then traded much below those 5130 levels and closed with a huge loss at 5088. Today, given the global cues, the Nifty is likely to open gap down and stay down for most of the trading session.
1) The Elder Ray readings : Bull Power reduces from -14 to -33 Bear Power rises from -50 to -140, indicating that the Bears are in full control of the Nifty now, and that the Bulls will have a tough time ahead. For today, the Bulls need to overcome 5200 to regain their lost territory, whereas the Bears need to breach 5060 to maintain their downwards momentum.
2) The Nifty is now trading well below all its key EMAs and all its key DMAs.
3) The stochastics are in the neutral zone and are pointing downwards.
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Disclaimer : We express our opinions on this blog primarily as a method of record keeping, i.e. archiving what was our opinion about the markets on any given particular day end. As such, trading in derivatives can be extremely dangerous to you and your finances. We strongly advice you to consult your financial advisor before trading based on the opinions published on this blog. We shall not be held responsible, under any circumstances, for any financial loss or profit, that may be accrued due to your trades being affected by our opinions.
