NIFTY Ends Week at Range Resistance (21 Sep 2014)

NIFTY Weekly Market Index Chart Analysis

The S&P CNX NIFTY traveled a range of 235 points during the week, but finally closed at 8121.45, a marginal 51 points higher than its open.

As visible on the chart, the range in which NIFTY is traveling since mid-May 2014 still remains valid, and the market closed on the line of resistance, after falling to the middle of the range during the week.

The weekly candlestick is a Hanging Man.  After last week's Doji at the market top, a Hanging Man is not a very positive signal.  The RSI has remained stationery as well and the divergence is not yet cured.  Higher volume shows improving interest trading in the market.

Will NIFTY breakout from the point of Resistance and jump above, or will it dive back into the range?  This should be observed during the week.

8145 is the resistance level for this week.  This keeps going higher each week as the resistance is a slant and not horizontal.

Unfortunately, NIFTY has fallen below the 6-week steep-diagonal support line.  This isn't a heartening signal.

(1) A strong upward move pulling the index high from the resistance point (8145 is the resistance level for the week) ; &(2) the index closing above the resistance line for 2-3 consecutive days can lead to positive signal if other indicators agree. Unless this happens, do not go in for long positions.


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NIFTY Weekly Market Index Chart Analysis

NIFTY Had An Indecisive Week (14 Sep 2014)

NIFTY Weekly Market Index Chart Analysis

The market fell a minor 0.33% this week, and sustained the support line.  However, it is too close to the support line for us to be relaxed.

The weekly candlestick is not a perfect Doji, but it does resemble a Doji.  This is a signal of confusion in an upward trending market.  Volume has risen during the week but range of market movement was relatively small.  The market seems to be gearing up for a bigger move.

Notably, over the past 17 weeks (4 months), the 14-week RSI is forming a bearish divergence to the NIFTY.  This needs to be watched closely, as either the RSI will rise and match NIFTY; or NIFTY will fall and match the RSI.  The divergence has sustained for quite a while now!

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NIFTY Weekly Market Index Chart Analysis

NIFTY Hits Resistance: Weekly Technical Chart 6Sep14

NIFTY Weekly Chart Technical Analysis

NIFTY closed at its resistance on 5Sep14.

It's be a superman-week for NIFTY - up, up & away!

The index has hit resistance near 8086, the weekly closing on 5Sep14.

The 50-day SMA is happily facing north, volume has fallen but still above the average, RSI is above 70% as well.  All positive signals.

If the index jumps above resistance, we well see some new market high next week.  Otherwise there could be some correction to around 7850 levels before hitting support.

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NIFTY Weekly Chart Technical Analysis

NIFTY Continues in Downward Price Channel

NIFTY Weekly Chart Technical Analysis
(each candlestick represents one week of movement)

Ever since NIFTY peaked in Nov 2010, it has been falling within a price channel as is visible on the chart.  Moreover, the entire week saw a small price movement even when the trading volume was good.  This week the price may fall further and touch its support line at around 4380 during the week. Let's see what happens from there.

If the price falls below 4380, then there could be an opportunity to short NIFTY.  If it doesn't and bounces back, then there could be as short-term opportunity to go long or expect a positive movement.  No long term correction in sight, though.

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NIFTY Weekly Chart Technical Analysis

NIFTY rises, but will this sustain?

NIFTY Weekly Chart Technical Analysis:
(each candlestick represents one week of movement)

Nifty had a fun day on its post-Diwali opening session and rose by almost 160 points as compared to its previous close.

This is a welcome rise, but there is the strong line of resistance to break near 5450.  This resistance has lasted over an year now, and is quite strong.  Nifty is moving in a price channel and it will be interesting to watch what it does once it hits the resistance.

If NIFTY breaks above 5450 with good power, it would be a very positive sign.  Otherwise, prepare for another fall!

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NIFTY Weekly Chart Technical Analysis

NIFTY Outlook for the Week July 4 - 8, 2011

NIFTY WEEKLY TECHNICAL CHART ANALYSIS:

This has been a good week for NIFTY, after it bounced back creating a hammer formation from the dreaded 5200 level in the last week.  However, the next week can be difficult and the index could fall again.

You can see that there is a line of resistance which is applicable since Nov 2010, i.e. 7 months ago.  This makes it a strong line of resistance to reckon with. 

The index reached this line of resistance twice and then fell back again.  Out of these previous two times, it tried to break above this line for an entire month in the Apr-May 2011 period but couldn't do so and fell back again.  You can see that all the weekly highs during that period touched the line of resistance but failed to rise above it.

Now again for the 3rd time, the index is about to reach this line of resistance and will meet it around 5717.  This is an important point to watch out for.  If the index rises above this level then we can look at a positive movement in the coming weeks.  However, if 5717 is not breached and the index falls below, then we would ideally expect it to head towards 5350 and then 5200 before making any further movements. 

For now, wait and see what happens at 5717 before making any important trade decisions.

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NIFTY WEEKLY TECHNICAL CHART ANALYSIS

NIFTY Outlook: Where is the tricky index headed?

NIFTY Daily Chart Technical Analysis:

As the chart predicted last month (see my previous on NIFTY), 5500 has been an important level throughout May and June.  The index remained around this level initially and then fell to the 5200 level.

Why is 5200 important?  

The market has reached this level for the 3rd time since July 2010 (almost an year ago).  Last time was in Feb 2011, when the market dipped below 5200 briefly but rallied back upwards. This time again, the market has reached 5200 and has now shown signs of support.

Two more patterns have emerged.

The first is another important support at 5350.  Remaining above this level is a good sign as you can see in the chart.  While 5200 has served as a bottom, 5350 has served as the stronger support level over the past year.

Another is the diagonal set of parallel lines of support and resistance for the short term period since May 2011.  The line of support passes through 5200 just where the market dipped to this level in the current week.  This makes 5200 a very important level in the current week and that the market has shown support and remained above 5200 is a good sign.

Moreover, the volume has consistently lowered throughout the year and the current weekly volumes are atleast 50% or less as compared to a year ago.  The volume has progressively fallen.  This is showing a lowered interest in the market at the current rates.  This could be a sign that the market is readying for a move soon.  

For the time being it does seem like the market will rebound towards the higher levels after sputtering to a bottom of 5200.  But in the longer term, it is still doubtful if the market will be able to sustain above this level considering the socio-economic and political situation in India.  Defer from making long term decisions right now and trade for the shorter term, and beware of any fall below 5200 as this is an important support level.

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NIFTY Daily Chart Technical Analysis

NIFTY in Decreasing Triangle

NIFTY Weekly Chart Technical Analysis:

Nifty has been interestingly volatile in the past few weeks.

As visible on the chart, there is a resistance line of a decreasing triangle that Nifty is unable to break since the past 3 weeks.  This resistance line began in Nov 2010 and Nifty is unable to break the same as of yet.  

Think of a long position this week only if Nifty comfortably goes and closes above 5945.  In fact, there is a chance it might fall back to 5550 - 5600 levels.  Be alert, it's not a bull run yet.

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NIFTY Weekly Chart Technical Analysis

NIFTY Weekly Analysis 25-29 Oct 2010

This week ended on a not so positive note.  Let's look at what the technical indicators say:

Moving averages are traveling almost parallel. The 20 day moving average has branched out by a few points in the last month.  Overall, no signs of any big change very soon.

Volume is very good, showing high interest in the stock market and trading of NIFTY.  

2 lines of support can be drawn using previous weeks' resistance points.  These two lines can act as support in case NIFTY falls lower below.

Other important indicators point to a negative candle for the next week as well.  Is this going to be a non-optimistic Diwali?