Nifty Weekly
Still continue with the
consolidation theme, but slightly leaning to the bearish side TILL we do not close above 8k on the
Nifty index.
Risks/Observations:
On the weekly
chart the difference between the Open & Close was flat compared to the high
& low which is showing some indecision.
On the daily
chart it is clearly visible that the 8k zone on Nifty has been visited several
times in the past and has acted as Support & Resistance. A break above 8k
would be a positive but till then better to wait it out.
The dollar index
and USD-INR pair bounced off support zones in the last week – trends in the
currency space could play a big role in the Equity outlook.
On the VIX
projected range chart we have closed above the upper boundary and max high
looks to be in the area near 8k. (We also have a massive build-up in the 8k
strike call option since the start of this series!)
Seeing some
improvement in the Nifty/Bond ratio chart as it is sustaining above its 10 week
moving average but momentum yet to confirm.
The most bullish
data point looks to be the Sectoral & Broader indices that are trading
above their respective 40 week moving averages.
Auto, Energy,
Metal & Realty indices are the potential outperformers as they are
performing better than the Nifty & the 10 Year Bond Index (Refer Weekly
Relative Strength Charts).
To conclude – the weight of the evidence suggests a stance to the
neutral to bearish side, while the most important point to look for will be if
we can breakout above 8k.
Nifty weekly chart :
Nifty Daily chart :
US Dollar Index & USD-INR
pair :
Nifty VIX projected range chart :
Nifty/10 year bond ratio chart :
Indices above 40 week moving
average :
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