Archives : CONSOLIDATION BEFORE THE UPMOVE RESUMES - 11/06/2016.

CONSOLIDATION BEFORE THE UPMOVE RESUMES - 10/06/2016.

MARKET UNABLE TO CLEAR SENSEX 27148.

As expected the market was extremely sluggish throughout the week. After crossing over 61.8% Retracement of Nifty i.e. 8243, market failed to do the same in case of Sensex. Sensex made a high of 27105 for the week but was unable to close above the critical 61.8% level of 27148 which is the main reason for the current tiredness being displayed by the Bulls. This is not a sign of reversal; it is just a consolidation to gather strength; which will help the Bulls to overcome the above mentioned critical level. In the near term, expect strong support at the Bullish Gap between 7948-7941.


CONSOLIDATION BEFORE THE UPMOVE RESUMES - 10/06/2016.

MARKET UNABLE TO CLEAR SENSEX 27148.

As expected the market was extremely sluggish throughout the week. After crossing over 61.8% Retracement of Nifty i.e. 8243, market failed to do the same in case of Sensex. Sensex made a high of 27105 for the week but was unable to close above the critical 61.8% level of 27148 which is the main reason for the current tiredness being displayed by the Bulls. This is not a sign of reversal; it is just a consolidation to gather strength; which will help the Bulls to overcome the above mentioned critical level. In the near term, expect strong support at the Bullish Gap between 7948-7941.

TECHNICALLY SPEAKING.

Sensex opened the week at 26897, made a high of 27105, low of 26620 and closed the week at 26635. Thus it closed the week with a loss of 208 points. At the same time the Nifty opened the week at 8228, made a high of 8294, low of 8162 and closed the week at 8170. Thus the Nifty closed the week with a loss of 50 points.

On the daily charts, both Sensex and Nifty have made a small Black body Inverted Hammer formation. This is a Bullish Reversal pattern which requires confirmation. On the weekly, charts both the indices have formed a small Black body candle. Thus daily candlestick pattern suggests mild bullishness depending on Monday’s candlestick formation, whereas weekly formations are more neutral in nature.

Both the indices are now retracing the entire fall from Sensex 30024 to 22494 and Nifty 9119 to 6825. The relevant Retracement levels are placed at Sensex 25371-26259-27148 and Nifty 7702-7972-8243.

This week, Nifty managed a close above the 61.8% Retracement level i.e. at 8243, but the Sensex failed to do so. The current sluggishness in the market is due to the failure of Sensex to cross its 61.8% Retracement level which is at 27148. Thus when Sensex closes above this level, it will mark the end of Correction phase and will signal a move towards testing the life highs of Sensex 30024 and Nifty 9119.

MACD and Price ROC are both positive and continue with their Buy signals. RSI (59) suggests continuation of bullish momentum. Stochastic Oscillator %K (94) is overbought but is in Sell mode as it is below %D. ADX is at 26, which suggest that uptrend is now gaining strength. Directional Indicators continue in Buy mode as +DI remains above –DI. Buy signal continues in Bollinger Band since last two weeks. MFI (62) suggests Positive Money Flow. OBV continues in Buy mode, making higher tops higher bottoms. Thus majority of Oscillators are suggesting bullishness in the near term.

This week, despite the sluggishness, both the indices still managed to remain above the short term average of 20dma (Sensex – 26263 and Nifty – 8043), medium term average of 50dma (Sensex – 25769 and Nifty – 7890) and even the long term average of 200dma (Sensex – 25546 and Nifty – 7771). Thus the trend in the short term, medium term and the long term timeframe continues to remain Bullish.

Options data for June series indicate highest Call Open Interest build-up has shifted to the strike of 8300 and highest Put build-up still remains at 8000. Thus Option data suggests a trading range with resistance coming in at 8300 and support at 8000.

INDEX LEVELS:

S3

S2

S1

CLOSE

R1

R2

R3

Nifty

7890

7992

8088

8170

8262

8359

8448

Sensex

25549

25927

26256

26635

27008

27318

27618

LAST WEEKS RECOMMENDATIONS:

STOCK

Reco. Price

Tgt

Reached

Lot Size

Profit

Bajaj Auto

2639

2724

2658

200

Rs. 3,800

KotakBank

769

795

779

700

Rs. 7,000

PowerGrid

150

156

155

4000

Rs.20,000

DwarkeshSug

220

253

243

3000

Rs.69,000

Buy PTC

68

72

75

8000

Rs.56,000

Total

Rs.1,55,800.

THIS WEEKS RECOMMENDATIONS:

STOCK

CMP

SL

Tgt-1

Tgt-2

Buy ReLInfra

549

537

568

588

Buy JsWSteeL

1418

1385

1468

1520

Buy CoLPaL

872

853

901

931

Buy Vedanta

116

113

121

127

Buy PetronetLNG

276

270

285

295

WATCH OUT FOR:

Vedanta

ReL Infra

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.

Copyright © 2000 - 2018 Jatin Sanghavi. All rights reserved.
No part of the material on this website may be reproduced or distributed in any forms or by any means, electronics or mechanical without the written permission of the author.
Sitemap