Daily Nifty Technical Report 20 November

Sensex (20891) / Nifty (6203)

On Tuesday, our benchmark index opened on a flat note considering mixed global cues. Subsequently, Nifty slipped into a consolidation mode and remained range bound throughout the session to close on a muted note. On the sectoral front, the Realty, Capital Goods and Teck counters were among the major gainers; whereas the Consumer Durables, FMCG and Healthcare sectors ended with nominal losses. The advance to decline ratio was marginally in favor of the advancing counters. (A=1286 D=1218)

Formation

  • The ’89-day EMA’ and the ’89-week EMA’ are placed at 20017 / 5954 and 19029/ 5716 levels, respectively.
  • The ’20-day EMA’ and the ‘20-week EMA’ are placed at 20651 / 6134 and 20097 / 5979 levels, respectively.
  • The monthly momentum oscillators are now positively poised; whereas the weekly momentum oscillators are contradictory.

Trading strategy:

We witnessed lethargic and range bound activity during yesterday session. In our previous report, we had mentioned that the 61.8% Fibonacci retracement level of the recent fall might act as a resistance for the Nifty. The index has now closed around this level and has formed a ‘Narrow Range’body on the daily chart. An occurrence of such candle indicates indecisiveness at the resistance level and does not bode well for the bulls. Going forward, a sustainable move below 6180 level may apply temporary brakes on current optimism. In this case, the lower levels of 6141 – 6110 may be retested. On the flipside, a move beyond 6213 is likely to push the index towards 6250 – 6305 levels.

Exhibit 1: Nifty Daily Chart

Actionable points:

View Neutral

Support Levels 6141 – 6110

Resistance Level 6250 – 6305

 

Bank Nifty Outlook – (11188)

Yesterday, in-line with our benchmark index, the Bank Nifty too opened on a subdued note and oscillated within a thin trading range. As a result, the daily chart now depicts ‘Narrow Range’ body formation. The said patternhas occurred when the market is near the strongresistance. Similar to benchmark index, the Bank Nifty has now closed tad below the 61.8% Retracement level(11226) of the recent fall from 11540 to 10412 levels.Hence, going forward, only if Bank Nifty manages to sustain above this level (11226) then we may witness afurther rally up to 11400 – 11510 levels. On the otherhand, yesterday’s low of 11107 would now act as an immediate support level for the index. Any sustainable move below this level would open up chances of further correction towards 10962 – 10660 levels.

Exhibit 2: Bank Nifty Daily Chart

Actionable points:

View Neutral

Support Levels 11107 – 10962

Resistance Level 11400 – 11510 

 

Courtesy: angel broking

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