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21.07.2019



AAKASHAYA PATRA WEEKLY MARKET OVERVIEW:


The Market stood bitterly disappointed when the FM Nirmala Sitharaman squashed any hope of a tweak in FPI surcharge, which would have saved FPIs from the 'Super Rich' Tax. As a result the Sensex crashed by around 550 points on Friday itself. In the process, the Market has decisively broken the Confluence Support of 100dma and Trendline and now currently stands in the strong Support Zone in the form of Weekly Bullish Gap Sensex 38570-38001 and Nifty 11591-11426. A decisive break of the above Gap can lead the Market towards the 200dma.


Technically Speaking :-

Sensex opened the week at 39009, made a high of 39284, low of 38271 and closed the week at 38337. Thus it closed the week with a loss of 399 points. At the same time the Nifty opened the week at 11614, made a high of 11706, low of 11399 and closed the
week at 11419. Thus the Nifty closed the week with a loss of 133 points.On the daily charts, both Sensex and Nifty have formed a big Black Body Candle. On the weekly chart, both Sensex and Nifty have formed a Real Black body Candle, which is indicative of the Bearish mood of the market.

Thus, candlestick pattern is suggesting a bearishness bias in the near term.This week saw the indices breaking the Support zone which is due to the confluence of 100dma and Trendline. As a result the indices are already inside the strong Support zone formed by the daily as well as weekly Bullish Gap between Sensex 38570-38001 and Nifty 11591-11426.A break of the above mentioned Gap Support Zone can take the indices down to test the Trendline Support at Sensex 37864 and Nifty 11336. A break of this Trendline can take the indices lower to test the long term average of 200dma (Sensex 37064 and Nifty 11125).Nifty has formed a Bearish Gap 11771-11797 on daily as well as weekly charts. Any pull-back will face strong Resistance at this Bearish Gap. On the other hand, Sensex has not formed any Bearish Gap on daily or weekly charts.Both the indices had completed a Bullish Cup & Handle pattern in March 2019 and now they are heading towards their target of Sensex 41053 and Nifty 12232. Also a Rounding Bottom got completed,which has a target of Sensex 44687 & Nifty 13516.This week, both the indices closed below the short term average of 20dma (Sensex - 39197 and Nifty - 11706) as well as the medium term average of 50dma (Sensex - 39130 and Nifty - 11718).Both the indices continue to remain above the long term average of 200dma (Sensex - 37064 and Nifty - 11125). Thus the
Trend in the long term Timeframe continues to be Bullish, whereas the Trend in the short term as well as medium term Timeframe has turned Bearish.

MACD and Price ROC are both negative and in Sell mode. RSI (36) suggests Bearish momentum.Stochastic Oscillator %K (23) is below %D and hence in Sell mode. ADX (22) suggests Downtrend slowly developing. Directional Indicators are in Sell mode as +DI is below -DI. MFI (55)suggests Positive Money Flow. Thus majority of Oscillators are suggesting a bearish bias.

Options data for July series indicate highest Call Open Interest remains at 12000 and the highest Put build-up is shifted to the strike of 11300. Thus Options data suggests a trading range with resistance at 12000 and strong support at 11300.

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