*AAKASHAYA PATRA WEEKLY MARKET
OVERVIEW:* 26.04.2020
The Market is still in the Pull-Back mode but the speed of Recovery
has reduced. The reduction in upward momentum can be attributed to the fact
that the indices have tested the 38.2% Retracement on both Sensex (31993) and
Nifty (9390) in the week gone by. This calls for some cooling off before resuming
any further price movement and that is what the indices have done in the past week.
We are currently in a short term Trading Range between 8800-9400, breakout of
which will determine further direction as well as magnitude of price movement.
A break of 9400, will take the Nifty to test higher Retracement levels of
9970-10551, whereas a bearish downward break of the
trading range can take the Nifty all the way to test 8477-7511-6149.
Technically
Speaking :-
Sensex opened the week at 32056, made a high of 32056, low of 30378
and closed the week at 31327. Thus it closed the week with a loss of 261
points. At the same time the Nifty opened the week at 9390, made a high of
9390, low of 8909 and closed the week at 9154.Thus the Nifty closed the week
with a loss of 112 points.On the daily charts, both the indices have formed a
small Doji on the lines of Gravestone Doji but here the placement of the candle
and the size of the upper shadow makes it an insignificant pattern. On the
weekly timeframe, both Sensex and Nifty have formed an Opening Black Body
Marubuzo. Again it cannot be termed as a significant pattern as not only the lower
shadow is long but even the Black body is just average which does not help the Bearish
quotient of the pattern, Thus daily as well as weekly formation suggest a
stagnation in the price movement with a minor tilt towards bearishness.
Even though the indices are facing stagnation while moving higher,
the fact is the Market is still in Pull-Back mode. The Pull-Back levels are
placed at Sensex 31993-33956-35918 and Nifty 9390-9970-10551. The pace of
Pull-Back, which started after Sensex made an intermediate bottom at 25638 and
Nifty 7511, has reduced significantly after both the indices touched the 38.2% Retracement
level. The Pull-Back will be in contention as long as the Sensex remains above 30016
and Nifty 8821.
If the current Pull-Back gathers further strength then, both the
indices will face strong Resistance Zone at the Bearish Gap between Sensex
34769-35109 and Nifty 10159-10294. On the downside, if Nifty closes below 8477,
then it can go all the way down to 7511-6149.For the entire week, both the
indices have managed to stay above and even close above the Short term average
of 20dma (Sensex - 29998 and Nifty - 8768), thereby maintaining the Short Term
Trend as positive. Both the indices continue to remain below the Medium term
average of 50dma (Sensex - 34301 and Nifty 10042) and even the Long term
average of 200dma (Sensex -38110 and Nifty - 11245). Thus the Trend in the
Short term has become Positive whereas the Trend in the Medium term as well as
Long term Timeframe continues to remain Bearish.
MACD and Price ROC both continue in Buy mode. RSI (49) suggests
minor tilt towards Bearish bias. Stochastic Oscillator %K (87) is above %D and
hence continues in Buy mode. ADX (29) suggests Downtrend has lost lots of its
strength. Directional Indicators are in Sell mode as +DI is below -DI. OBV
continues in Sell mode, making lower top lower bottom formation. MFI (61)
suggests Positive Money Flow. Thus Oscillators are suggesting a mixed picture.
Options data for April series indicate highest Call Open Interest at
9500 strike. Highest Put build-up is at the strike of 9000. Thus Options data
suggest a trading range with Resistance at 9500 and Support at 9000.
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