Weekly analysis : WAITING TO EXPLODE - 12/04/2019.

WAITING TO EXPLODE - 12/04/2019.

 

CONSOLIDATION NEAR THE TOP.

 

Just when it seemed that Nifty will correct its stupendous rise of the last few days, it did not. There was a hint of Correction finally happening but it seems Market is in no mood to oblige. At the most, we can have Nifty consolidating near the top. Once Consolidation is over, Nifty will be on its way to achieve its higher target of 11822-12232. Any decline should be treated as Buying Opportunity. One should have a strong inclination for the Mid-Caps and Small-Caps which finally have started playing catch-up. It is time to indulge in stock-picking; as Mid-Cap blast is not far away.

 


WAITING TO EXPLODE - 12/04/2019.

 

CONSOLIDATION NEAR THE TOP.

 

Just when it seemed that Nifty will correct its stupendous rise of the last few days, it did not. There was a hint of Correction finally happening but it seems Market is in no mood to oblige. At the most, we can have Nifty consolidating near the top. Once Consolidation is over, Nifty will be on its way to achieve its higher target of 11822-12232. Any decline should be treated as Buying Opportunity. One should have a strong inclination for the Mid-Caps and Small-Caps which finally have started playing catch-up. It is time to indulge in stock-picking; as Mid-Cap blast is not far away.

 

TECHNICALLY SPEAKING.

 

Sensex opened the week at 38993, made a high of 39041, low of 38460 and closed the week at 38767. Thus it closed the week with a loss of 95 points. At the same time the Nifty opened the week at 11704, made a high of 11710, low of 11549 and closed the week at 11643. Thus the Nifty closed the week with a loss of 22 points.

 

On the daily charts, both the indices have formed a small White Body Spinning Top. It is a neutral formation occurring in sideways consolidation. On the weekly charts, both Sensex and Nifty have formed a small Black body candle with a lower shadow. The formation is almost like a Hanging Man but it is not as the lower shadow is not twice the length of the body. Thus both daily as well as weekly candle-stick study suggest a sideways consolidation bias.

 

When the indices gave a Bullish breakout for the Trading Range of four months, a Bullish Cup & Handle pattern got completed. The target for the pattern falls at Sensex 41053 and Nifty 12232. Both Sensex and Nifty are in sideways consolidation and once that is over, both the indices will be headed for the above mentioned targets.

 

Market has strong Support at the higher bottom of Sensex 37667 and Nifty 11311 followed by Bullish Gap between Sensex 37230-37106 and Nifty 11227-11180. Thus this Bullish Gap will act as strong Support zone. Also the Gap can be called as Measuring Gap. The target as per that will be Sensex 39049 & Nifty 11822.

 

This week, both the indices tested the short term average of 20dma before bouncing back. Again both the indices have closed above all the Moving Averages viz. the long term average of 200dma (Sensex – 36445 and Nifty – 10968), the medium term average of 50dma (Sensex – 37240 and Nifty – 11178) and also the short term average of 20dma (Sensex – 39518 and Nifty – 10968). Thus the Trend in the long term, medium term and short term Timeframe remains Upwards.

 

MACD as well as Price ROC are positive but MACD is in Sell mode whereas Price ROC is in mode. RSI (62) still suggests strong Bullish momentum. Stochastic Oscillator %K (64) is below %D and hence in Sell mode. ADX (35) suggests UpTrend still very strong. Directional Indicators are in Buy mode as +DI is above –DI. MFI (74) suggests Positive Money Flow. OBV continues to make higher top higher bottom formation in line with the Bullish trend. Bollinger Band continues with its Buy signal. Thus majority of Oscillators are suggesting a Bullish bias.

 

Options data for April series indicate highest Call Open Interest is now at the strike of 12000 whereas the highest Put build-up is at the strike of 11000. Thus Options data suggests a trading range with resistance at 12000 & support at 11000.

 

INDEX LEVELS:

 

 

S3

S2

S1

CLOSE

R1

R2

R3

Nifty

11311

11434

11549

11643

11761

11870

11973

Sensex

37667

38089

38460

38767

39123

39423

39778

 

THIS WEEKS RECOMMENDATIONS:

 

STOCK

CMP

SL

Tgt-1

Tgt-2

Buy Maruti

7342

7232

7507

7676

Buy Astrazenca

2179

2135

2249

2327

Buy TVS Motors

500

489

517

535

Buy Engineers(I)

121

118

126

132

Buy BHEL

77

75

81

85

 

WATCH OUT FOR:

 

TVS Motor Symm Triangle

 

InfiBeam H&S

 

 

 

 

 

 

Disclaimer : The recommendations made herein do not constitute an offer to sell or a solicitation to buy any of the securities mentioned. No representations can be made that the recommendations contained herein will be profitable or that they will not result in losses. Readers using the information contained herein are solely responsible for their actions. Information is obtained from sources deemed to be reliable but is not guaranteed as to accuracy and completeness.

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