Archives : KNOCKING ON THE DOORS OF 10000 - 14/07/2017.

KNOCKING ON THE DOORS OF 10000 - 14/07/2017.

 

MARKET CLOSES @ RECORD HIGHS.

 

Just two weeks back when the market was undergoing a Retracement and the calls for a deeper Correction were growing louder; the market had other ideas. Not only did the market move higher after taking support at the 50dma, but now the Nifty is knocking on the doors of 10000. Once again the Correction proved to be a shallow, time-wise as well as price-wise. The indices are at record levels and it will be just a matter of time before Nifty enters the five digit club. Till then use every decline to buy.



KNOCKING ON THE DOORS OF 10000 - 14/07/2017.

 

MARKET CLOSES @ RECORD HIGHS.

 

Just two weeks back when the market was undergoing a Retracement and the calls for a deeper Correction were growing louder; the market had other ideas. Not only did the market move higher after taking support at the 50dma, but now the Nifty is knocking on the doors of 10000. Once again the Correction proved to be a shallow, time-wise as well as price-wise. The indices are at record levels and it will be just a matter of time before Nifty enters the five digit club. Till then use every decline to buy.

 

TECHNICALLY SPEAKING.

 

Sensex opened the week at 31510, made a high of 32109, low of 31471 and closed the week at 32020. Thus it closed the week with a gain of 660 points. At the same time the Nifty opened the week at 9719, made a high of 9913, low of 9646 and closed the week at 9886. Thus the Nifty closed the week with a gain of 221 points.

 

On the daily charts, both Sensex and Nifty have formed a small black body candle with a long lower shadow but that fails to qualify as a Shooting Star as the lower shadow is less than twice the length of the body. On the weekly charts, both the indices have formed a big white body candle which suggests a continuation in bullish trend. Thus daily as well as weekly candlestick patterns indicate bullishness in the near term.

 

Two weeks back the market rebounded after taking support at the 50dma and as of now the indices are at life-time high levels. On the weekly charts, both Sensex and Nifty have completed a second degree Bullish Flag pattern, the target for which falls at Sensex - 33619 and Nifty – 10343. The above targets will be achieved as long as Sensex remains above 30680 and Nifty above 9448.

 

Both the indices continue to remain above the short term average of 20dma (Sensex – 31334 and Nifty – 9656), medium term average of 50dma (Sensex – 30981 and Nifty – 9574) and even the long term average of 200dma (Sensex - 28712 and Nifty – 8874). Thus the Trend in the short term, medium term and even the long term timeframe continues to remain Bullish..

 

The current Rally has produced two Bullish Gaps. The first Bullish gap between Sensex 29780-29681 and Nifty 9250-9225 will not only act as Support but holds the key to intermediate trend. The second Bullish Gap which is more significant as it is also a Weekly Gap i.e. between Sensex 29356-29098 and Nifty 9060-8977 hold the key to the long term trend. Besides acting as a support, this gap also acts as a Measuring Gap. The target as per Gap theory falls at Sensex 32737 and Nifty 10144.

 

A Saucer pattern was completed when the indices closed above Sensex 29077 and Nifty 8968. The complete pattern target which is at Sensex 32437 and Nifty 10043 remains to be achieved. On the weekly formation, both the indices completed a Cup and Handle formation and the targets are Sensex 34677-37554 and Nifty 10536-11413.

 

If one considers the Cup and Handle formation of 7 years from 2007 to 2014, the target for that pattern falls at Sensex 34715 and Nifty 10462. The Golden Ratio target of the current pattern weekly pattern of 2 years is at Sensex 34677 and Nifty 10536. Thus in the medium term one can expect a test of the above targets i.e. Sensex 34677-34715 and Nifty 10462-10536.

 

MACD and Price ROC, both are positive and in Buy mode. RSI (75) suggests bullish momentum. Stochastic Oscillator %K (96) is above %D and hence in Buy mode. ADX has increased to 30, which suggests that the Uptrend is now gaining strength. Directional Indicators continue in Buy mode as +DI is above –DI. MFI (70) suggests Positive Money Flow. OBV continues to make higher tops and bottoms. Bollinger Band has signalled a Buy on Monday. Thus all Oscillators are suggesting a bullish bias, except that the momentum oscillators are in overbought terrain.

 

Options data for July series indicate highest Call Open Interest is at the strike of 10000 and highest Put build-up is at 9600. Thus Options data suggests a trading range with resistance coming in at 10000 and support at 9600.

 

INDEX LEVELS:

 

 

S3

S2

S1

CLOSE

R1

R2

R3

Nifty

9576

9698

9787

9886

9970

10043

10144

Sensex

31097

31426

31732

32020

32364

32737

33089

 

THIS WEEKS RECOMMENDATIONS:

 

STOCK

CMP

SL

Tgt-1

Tgt-2

Buy BajajFinserv

4399

4310

4535

4679

Buy Maruti

7557

7415

7767

7990

Buy CholaFin

1154

1130

1190

1227

Buy Ujjivan

346

338

358

371

Buy DCB

202

197

210

219

 

WATCH OUT FOR:


Chola Inv

 

HPCL

 

 

 

 

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