Nifty continued its winning streak for the second consecutive week and also continued to make a higher top and higher bottom formation on the daily chart.
If we take the retracement of the entire fall from the highs of 12150 to the low of 7511 than 38.2% retracement is coming around 9315, which has been achieved successfully on Friday. Now, if Nifty manages to sustain above 9300 levels then we can expect further momentum to continue towards 9865 as well which is a 50% retracement level of the entire fall.
The momentum indicator RSI is making a higher top and higher bottom formation and currently at 50.65 levels which hints of some positive momentum to continue.
Now, the immediate support is at 8800 followed by 8600, resistance is at 9300 followed by 9500.
The broader trend for Nifty continues to remain negative as long as it trades below 10000 and currently, we are witnessing a ripple effect of a global market rally in Indian equities, too. So we can expect another leg on the downside once this pullback gets over.
The Volatility index “IndiaVIX” fell for the third consecutive week and ended below 45 which is giving comfort to the bulls.
On the derivative front, the maximum open interest on the Put side is shifted to 9000 strikes on monthly as well as weekly expiry. Whereas, maximum open interest on the call side is placed at 9500 followed by 10000 strikes. The data indicates a trading range of 9000-9500 for the next week.
BANKNIFTY has provided breakout from a symmetrical triangle pattern on the daily chart and now it is likely to move towards 21500 and then 22000 levels. The Immediate support is pegged at 19700 and below that, it may drift to 19200 levels.
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The stock has provided breakout fresh from its double bottom pattern on the daily chart. The weekly chart stock has formed a big bullish candle with higher than average volume which also supports the positive move. The momentum oscillator MACD has also given buy crossover, which hints of positive momentum to continue.
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The stock has formed a dragonfly Doji candlestick pattern on the daily chart which is considered as a reversal pattern. The stock formed a symmetrical triangle pattern, where a breakout is placed at 1270. The momentum indicator and oscillators are well in buy mode.
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The stock after forming base has provided breakout from a symmetrical triangle pattern on the daily chart. The stock has also formed a breakaway gap on the daily chart, which hints of positive momentum to continue.
Author: Mr.Nilesh Ramesh Jain, Derivative and Technical Analyst (Investment Services), 17th April 2020