20.10.2019
AAKASHAYA PATRA WEEKLY MARKET OVERVIEW
As
the Deepawali week neared, the Bulls slowly made a come-back. To the relief of
the Market Participants, the Trend across time-frames has now turned Bullish.
The entire week saw the Bulls dominating the proceedings, as each day the Nifty
managed a higher closing. It exactly happened as mentioned in the previous
week's article, that a close above 100dma would lead the Nifty to previous
intermittent top of 11692. Now the Nifty will be eyeing the strong Resistance
in the form of weekly Bearish Gap between 11771-11797. A close above this
Resistance level will lead the Nifty to previous top in no time. Henceforth
every dip should be treated as a buying opportunity.
Technically Speaking :-
Sensex
opened the week at 38208, made a high of 39361, low of 38066 and closed the
week at 39298. Thus it closed the week
with a gain of 1171 points. At the same time the Nifty opened the week at
11335, made a high of 11684, low of 11290 and closed the week at 11661. Thus
the Nifty closed the week with a gain of 356 points.On the daily charts, both
Sensex and Nifty have formed a small white body candle almost like a Spinning
Top. On the weekly charts both the indices have formed a Bullish Harami which
is a Bullish reversal pattern but requiring confirmation. Thus both daily as
well as weekly candlestick pattern study indicate a Bullish bias in the near
term.
On
the daily charts, both Sensex and Nifty have formed a Real White body candle
suggesting bullishness. On the weekly charts both the indices have formed a Big
White Body Candle which is negating the bearishness of the candle formed two
weeks back. Thus both daily as well as weekly candlestick pattern study
indicate a Bullish bias in the near term.
The
indices till last week were gyrating between the Support defined by 50dma and
Resistance in the form of 100dma. Finally this week, the indices managed to
overcome the Resistance of 100dma, and the Nifty is on the verge of testing the
strong Resistance in the form of Weekly Bearish Gap between 11771-11797. A
close above the Weekly Bearish Gap will open the gates for the indices to
reclaim their life-high levels again.
If
the Support of 50dma is broken, then the Market is likely to move lower and
test the strong long term Support Zone which is defined by the Confluence Zone
of strong Weekly Trendline Support and 100 WeeksMA, which had given Support for
7 consecutive weeks for Sensex, Nifty and even Bank Nifty.
This
week, both the indices closed above the short term average of 20dma (Sensex -
38342 and Nifty - 11373), medium term average of 50dma (Sensex - 37575 and
Nifty - 11124) and even the long term average of 200dma (Sensex - 37768 and
Nifty - 11287). Thus the Trend in the short term,medium term as well as long
term Timeframe has turned Bullish.
MACD
and Price ROC are both positive and in Buy mode. RSI (63) suggests Bullish
momentum.Stochastic Oscillator %K (88) is above %D and hence is in Buy mode.
ADX (18) suggests consolidation. Directional Indicators are in Buy mode as +DI
has gone above -DI. MFI (55) suggests Positive Money Flow. Buy signal in
Bollinger Band stands negated. Thus Oscillators are suggesting a Bullish bias.
Options
data for October series indicate highest Call Open Interest at 12000 and the
highest Put build-up at the strike of 11000. Thus Options data suggests a
trading range with resistance at 12000 and support at 11000.
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