And where is Nifty heading next week on 22nd October 2019?
Nifty had been at its supply zone as mentioned in our previous analysis. Today, it started the day at 11,657.15 with a loss of few points with good round of profit booking. It remained under pressure and touched days low at 11,573.65 witnessing some buying pressure and closed at crucial support 11,588.35. After touching the days high at 11,714.35 Nifty closed with a net loss of 73.5 points at the end of the day. The Index made Bearish Harami candlestick on the daily as well as weekly charts. Today, the DIIs were net sellers with -985.47Cr while FIIs were also net sellers with -557.50Cr. From the Nifty50 stack, 24 stocks advanced and 26 declined.
Today’s closing at 11,588.35 is at 61.8% Fib level, above weekly Pivot at 11,535.23 and 200 DEMA at 11,239. Stochastic remains in overbought zone and is at 85.75, thus, indicating for consolidation or some more correction. RSI is at 60.36 while MACD is still above zero with a bullish crossover with bullish strength building up. Besides the market is in the supply zone at the double top. Nifty needs strong domestic and international cues to continue its bullish journey towards 11,725 and 11,770.
The daily resistance levels are at 11,600, 11,655, 11,695, 11,725, 11,770 and 11,814. The support levels can be seen from the Nifty Daily chart at 11,588 (61.8% Fib of recent High), 11,553, 11,500, and 11,463 (61.8% Fib of recent low). Looking at current immediate support and resistance level for the next trading day seems to be from 11,450 to 11,700.
On the Options side, Put unwinding was seen at lower levels. Call writing was seen at 11,600, 11,700, 11800 and 12,000 levels thus shifting resistance levels. Looking at the Open Interest data the PCR @EOD came down at 0.87 which indicates a mild bearish bias with some consolidation.
Technical analysis with a sound understanding of the market is the key to trading success, however, sometimes, unexpected (domestic or international) factors make the technical analysis go haywire for a while. Market forces are stronger than our analysis sometimes, and we have to monitor fresh data and new dynamics of the market during trading hours to consistently make money.
We trust the information will be helpful in your own analysis of the market and make trading a profitable and better experience. This analysis has been shared for educational purposes. Please seek your financial adviser’s guidance before trading or investing.
Happy Trading and Keep investing safely!
