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*AAKASHAYA PATRA WEEKLY MARKET OVERVIEW:* 11.05.2020

As expected the Pull-Back seems to have been completed at the Nifty level of 9889, which translates into a humungous rise of almost 2400 points. Bearish Island formation this week not only signalled a Bearish Reversal in the immediate timeframe but also indicated a completion of the Pull-Back. Bearish Island can get negated only if Nifty closes above 9889, the probability of which remains low. The Nifty immediately retraced after testing the 50dma and took Support at the 20dma for better part of the past week. A break of 20dma can take the Nifty down to test the Retracement Supports at 8980-8700-8419.

Technically Speaking :-

Sensex opened the week at 32748, made a high of 32748, low of 31158 and closed the week at 31642. Thus it closed the week with a loss of
2075 points. At the same time the Nifty opened the week at 9533, made a high of 9533, low of 9116 and closed the week at 9251. Thus the Nifty closed the week with a loss of 608 points.

On the daily charts, both the indices have formed a small Opening Black Body Marubuzo which is more like a neutral formation due to the smaller size of the body. On the weekly timeframe, both the indices have again formed an Opening Black body Marubuzo which has a Real body. It is also forming a Bearish Harami pattern if we allow leniency factor. Bearish Harami requires confirmation in the form a bearish candle for the next week. Thus Candlestick study indicates a Bearish bias in the near term.

This week, both the indices formed a Bearish Gap between Sensex 32748-33354 and Nifty 9533-9731, which will act as strong Resistance. Besides, the Gap has completed a Bearish Island Reversal which has indicated the end of Pull-Back. The Bearish Island can get negated if we have Sensex closing above 33887 and Nifty 9889.Bearish Island has thrown a spanner in the Pull-Back and put an end to it in the near term.As the indices continue to drift lower, Retracement Support will be seen at Sensex 30736-29763-28789 and Nifty 8980-8700-8419. A break of Nifty 8419 will be cause of concern as it can open the passage for a retest of the Bottom at 7511.

Both the indices have managed to close above the Short term average of 20dma (Sensex- 31470 and Nifty - 9211) but failed to sustain above the Medium term average of 50dma (Sensex - 32648 and Nifty 9550). Both the indices continue to remain below the Long term average of 200dma (Sensex - 37788 and Nifty - 11140). Thus the Trend in the Short term Timeframe remains positive whereas the Trend in the Medium term as well as Long term Timeframe continues to remain Bearish.

MACD and Price ROC continue in Buy mode. RSI (49) suggests a slight tilt towards Bearish bias. Stochastic Oscillator %K (35) is below %D and hence in Sell mode. ADX (18) suggests no clear trend. MFI (59) suggests Positive Money Flow. Thus Oscillators are painting a mixed picture.

Options data for May series indicate highest Call Open Interest at the strike of 10000 followed by 9500. Highest Put build-up is at the strike of 9000 followed by 8500. Thus Options data suggest a trading range with Resistance at 9500 and Support at 9000.

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