*AAKASHAYA PATRA WEEKLY MARKET
OVERVIEW:* 03.05.2020
The Market saying "Stronger the Fall, Sharper the Rise"
seems to be coming true. Nifty fell by almost 40% in a matter of 7 weeks, and
the subsequent Pull-Back of around 32% from the bottom has been equally sharp
and that too in a matter of just 6 weeks, which has resulted in the Short and
Medium term Trend turning Up. As Nifty continues to tread higher, the question
on everyone's mind remains: Is the Bear Market over? The answer is in the no.
We are in midst of a Bear Market Pull-Back which tends to be very sharp and
short lived. As we approach strong Resistance Zone 10159-10294, there is a
possibility that this Pull-Back might get completed and the DownTrend will
resume.
Technically
Speaking :-
Sensex opened the week at 31659, made a high of 33887, low of 31651
and closed the week at 33717. Thus it closed the week with a strong gain of
2390 points. At the same time the Nifty opened the week at 9259, made a high of
9889, low of 9250 and closed the week at 9859. Thus the Nifty closed the week
with a gain of 705 points.
On the daily charts,
both the indices have formed a White body candle which is smaller than a Real
body candle, but after a big Upward Gap. On the weekly charts, both Sensex and Nifty
have formed a Big Opening White Body Marubuzo, which is aiding in continuation
of Upward rally. Thus daily as well as weekly formations suggest a Bullish Bias
in the near Term.
The Market is
experiencing a Bear Market Pull-Back. The Pull-Back levels are placed at Sensex
31993-33956-35918 and Nifty 9390-9970-10551. The Pull-Back which started after Sensex
made an intermediate bottom at 25638 and Nifty 7511, is now nearing and ready
to test the 50% Retracement level. The Pull-Back will be in contention as long
as the Sensex remains above 30016 and Nifty 8821.
The current Pull-Back
is becoming stronger and is now on course to challenge the strong Resistance
Zone at the Bearish Gap between Sensex 34769-35109 and Nifty 10159-10294.Considering
the strong Bear Market we are in, the probability of overcoming the strong Resistance
Zone remains on the lower side.
Both the indices have
managed to close above the Short term average of 20dma (Sensex- 30764 and Nifty
- 9001) and even the Medium term average of 50dma (Sensex - 33609 and Nifty
9835). Both the indices continue to remain below the Long term average of
200dma (Sensex - 37966 and Nifty - 11197). Thus the Trend in the Short term as
well as Medium term Timeframe has become Positive whereas the Trend in the Long
term Timeframe continues to remain Bearish.
MACD and Price ROC are
both positive and in Buy mode. RSI (59) suggests Bullish bias.Stochastic
Oscillator %K (96) is above %D and hence in Buy mode. ADX (24) suggests that the
Downtrend has lost almost all of its strength. Directional Indicators are in
Buy mode as +DI is above -DI. MFI (73) suggests Positive Money Flow. Thus
Oscillators are painting a Bullish picture.
Options data for May series indicate highest Call Open
Interest at the strike of 10000.Highest Put build-up is at the strike of 9000.
Thus Options data suggest a wide trading range with Resistance at 10000 and Support at 9000.
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