Archives : NIFTY SET TO TEST LIFE-TIME HIGHS - 23/02/2017.

NIFTY SET TO TEST LIFE-TIME HIGHS - 23/02/2017.

RELIANCE JOINS THE BULL PARTY.

With every passing week, the indices are continuing their journey towards the top. As a result, the indices have moved higher and are now within striking distance of life time highs. A critical breakout will be witnessed if the Nifty closes above 8968 and Sensex above 29077 on weekly chart. After such a breakout, one should not be surprised to see another 10% being added to the indices. Interestingly, the old war horse Reliance Industries has joined the bull party on Wednesday when it managed a multi-year breakout by going up an astonishing 10% in a single day. With heavyweights like Reliance participating in the rally, market seems set to reclaim the all-time high levels and more.


NIFTY SET TO TEST LIFE-TIME HIGHS - 23/02/2017.

RELIANCE JOINS THE BULL PARTY.

With every passing week, the indices are continuing their journey towards the top. As a result, the indices have moved higher and are now within striking distance of life time highs. A critical breakout will be witnessed if the Nifty closes above 8968 and Sensex above 29077 on weekly chart. After such a breakout, one should not be surprised to see another 10% being added to the indices. Interestingly, the old war horse Reliance Industries has joined the bull party on Wednesday when it managed a multi-year breakout by going up an astonishing 10% in a single day. With heavyweights like Reliance participating in the rally, market seems set to reclaim the all-time high levels and more.

TECHNICALLY SPEAKING.

Sensex opened the week at 28481, made a high of 29065, low of 28419 and closed the week at 28892. Thus it closed the week with a gain of 424 points. At the same time the Nifty opened the week at 8818, made a high of 8982, low of 8809 and closed the week at 8939. Thus the Nifty closed the week with a gain of 118 points.

On the daily charts, both the indices have formed a small black body candle near the strong resistance level of Nifty 8968 and Sensex 29077. On the weekly charts, both the indices have formed a big white body candle after two weeks of neutral formations. Thus more than daily, the weekly candlestick study suggests bullishness in the near term.

The indices were moving in a small range between Sensex 28100-28700 and Nifty 8700-8900 for almost two weeks. Breakout occurred this week, after Reliance Industries took the mantle of leadership and helped the indices break the short term trading range. As things stand today, both the indices have closed shy of critical breakout levels i.e. Sensex 29077 and Nifty 8968. A weekly close above these levels can take the indices higher by at least 10% in the medium term timeframe and thereby easily surpass lifetime high levels.

Since both the indices are trading over the critical 61.8% Retracement level of Sensex 27994 and Nifty 8558, the long term uptrend has resumed and the indices can be expected to target the previous top.

Three weeks back, both the indices had completed a Bullish Flag pattern which is a Bullish Continuation pattern. The target as per this pattern falls at Sensex 28997-29165 and 9017-9029 for the Nifty. The above targets are likely to be achieved as long as Sensex remains above 27590 and Nifty above 8537.

MACD and Price ROC are both positive and continue in Buy mode. RSI (76) and Stochastic Oscillator %K (88) are both in Overbought Zone and continues to exhibit strong Bullish momentum. ADX is at 39 which suggest that the Uptrend is very strong. Directional Indicators continue in Buy mode as +DI remains above –DI. MFI (63) suggests Positive Money Flow. OBV continues in Buy mode and continues to make higher top, higher bottom formation. Bollinger Band continues in Buy mode. Thus Price and Momentum Oscillators are indicating bullishness in the near term. 

This week, both the indices continued to remain above the short term average of 20dma (Sensex – 28326 and Nifty – 8775), medium term average of 50dma (Sensex – 27375 and Nifty – 8451) and even the long term average of 200dma (Sensex – 27342 and Nifty – 8424). Thus the trend in the short term, medium term and even the long term timeframe continues to remain upwards.

Options data for March series indicate highest Call Open Interest build-up at the strike of 9000 and highest Put build-up is at 8500. Thus Options data suggests a trading range with resistance coming in at 9000 and support at 8500.

INDEX LEVELS:

S3

S2

S1

CLOSE

R1

R2

R3

Nifty

8614

8712

8826

8939

9023

9119

9227

Sensex

27736

28102

28487

28892

29183

29522

29844

THIS WEEKS RECOMMENDATIONS:

STOCK

CMP

SL

Tgt-1

Tgt-2

Buy OFSS

3702

3625

3819

3941

Buy KotakBank

810

790

841

873

Buy DCB

153

149

159

166

Buy Wipro

486

475

503

521

Buy NatcoPharma

810

789

843

879

WATCH OUT FOR:

Kotak Mah Bank

Reliance Ind

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