 "Nifty will fall further if it breaks 8,135: Devang Shah")
Nifty
CLOSE- 8296.30 (11.11.16)
Nifty closed 3rd consecutive week in negative territory. It has broken crucial support of 8300 levels during week. It made a panic bottom at lower levels of around 8002 levels & created sentiment of end of correction at these lower levels but eventually, it failed to confirm short term reversal after sharp rise from these lower levels. It made a high of 27,457.05 levels on sensex & 8598.45 levels on Nifty in this pull back rally & eventually started to fall further from these levels.
It has broken crucial channel on down side & closed below it end of at the end of weekly trading session which is also coincide with medium term reversal levels. These both evidences are sufficient enough to finally conclude levels wise (Price wise) medium term reversal with momentum which was showing weakness from quiet a long time.
Break of channel on down side is not a good sign for medium term perspectives which was UP till it holds. One can expect lower levels targets as per short to medium term wave counts till overall trend reverses.
Surprisingly Bank Nifty is still not showing sign of medium term reversal. Such kind strong divergence between Nifty/Sensex & Bank Nifty has not seen ever before which also made me in dilemma & delay to conclude medium term reversal but finally going with main indices (Nifty/Sensex) & concluding medium term trend reversal.
Exceptionally, it looks like impulsive rally on bank Nifty post budget from a bottom of March 2016 this year. We may see retracement in wave-II for lower levels targets of around 16000-15500 levels on bank Nifty in short to medium term.
The rally post budget march 2016 this year turned out to be Wave-X rally on main indices (Nifty/SENSEX) as per chart attached. It’s very similar to 2010-2013 phase as per chart attached (detailed explained in today’s INDICES Column). One can expect last & final wave-Y of II correction for lower levels targets in medium term before wave-III UP starts further.
I will timely review market behaviour at lower levels to conclude end of correction till that one should book stock specific profit & wait for the time being for fresh investment opportunity.
Short term outlook for the market still remains negative till Nifty trades below 8560 levels & expecting targets in the range of 8135-7927-7850 levels in this short term correction. Medium term outlook for the market remains negative till Nifty trades below 8737 levels & expecting targets in the range of 7600-7300-7000 levels in medium term.
Momentum indicators Daily KST & Daily MACD both are in SELL showing weakness. One should book stock specific profit at current levels of market. Its bull market correction, therefore, one should prefer to BUY outperforming stocks in systematic way in this correction & follow a trend with trail stop loss levels till it reverses in short term.
8000-8500 looks strong support & resistance respectively in short term based on derivative option open interest data. One should use any kind of pull back rally to sell or exit till overall trend reserves. Break of 8135 levels on Nifty will lead to further sharp fall without any kind of major pull back rally towards further lower levels targets as mentioned above it in short term
Stock Picks:
As market confirmed medium term reversal this week. And short term trend & medium term trend both are down. I would not recommend any kind of trading & Investment ideas for this week.
Devang Shah: The author of www.trendtechno.com (Trade with Trend) Consultant & Advisors in the world of Financial Market
Disclaimer: The analyst may have a position in the scrip mentioned above; the views given above are the personal views of the analyst.
CLOSE- 8296.30 (11.11.16)
Nifty closed 3rd consecutive week in negative territory. It has broken crucial support of 8300 levels during week. It made a panic bottom at lower levels of around 8002 levels & created sentiment of end of correction at these lower levels but eventually, it failed to confirm short term reversal after sharp rise from these lower levels. It made a high of 27,457.05 levels on sensex & 8598.45 levels on Nifty in this pull back rally & eventually started to fall further from these levels.
It has broken crucial channel on down side & closed below it end of at the end of weekly trading session which is also coincide with medium term reversal levels. These both evidences are sufficient enough to finally conclude levels wise (Price wise) medium term reversal with momentum which was showing weakness from quiet a long time.
Break of channel on down side is not a good sign for medium term perspectives which was UP till it holds. One can expect lower levels targets as per short to medium term wave counts till overall trend reverses.
Also Read
Surprisingly Bank Nifty is still not showing sign of medium term reversal. Such kind strong divergence between Nifty/Sensex & Bank Nifty has not seen ever before which also made me in dilemma & delay to conclude medium term reversal but finally going with main indices (Nifty/Sensex) & concluding medium term trend reversal.
Exceptionally, it looks like impulsive rally on bank Nifty post budget from a bottom of March 2016 this year. We may see retracement in wave-II for lower levels targets of around 16000-15500 levels on bank Nifty in short to medium term.
The rally post budget march 2016 this year turned out to be Wave-X rally on main indices (Nifty/SENSEX) as per chart attached. It’s very similar to 2010-2013 phase as per chart attached (detailed explained in today’s INDICES Column). One can expect last & final wave-Y of II correction for lower levels targets in medium term before wave-III UP starts further.
I will timely review market behaviour at lower levels to conclude end of correction till that one should book stock specific profit & wait for the time being for fresh investment opportunity.
Short term outlook for the market still remains negative till Nifty trades below 8560 levels & expecting targets in the range of 8135-7927-7850 levels in this short term correction. Medium term outlook for the market remains negative till Nifty trades below 8737 levels & expecting targets in the range of 7600-7300-7000 levels in medium term.
Momentum indicators Daily KST & Daily MACD both are in SELL showing weakness. One should book stock specific profit at current levels of market. Its bull market correction, therefore, one should prefer to BUY outperforming stocks in systematic way in this correction & follow a trend with trail stop loss levels till it reverses in short term.
8000-8500 looks strong support & resistance respectively in short term based on derivative option open interest data. One should use any kind of pull back rally to sell or exit till overall trend reserves. Break of 8135 levels on Nifty will lead to further sharp fall without any kind of major pull back rally towards further lower levels targets as mentioned above it in short term
Stock Picks:
As market confirmed medium term reversal this week. And short term trend & medium term trend both are down. I would not recommend any kind of trading & Investment ideas for this week.
Devang Shah: The author of www.trendtechno.com (Trade with Trend) Consultant & Advisors in the world of Financial Market
Disclaimer: The analyst may have a position in the scrip mentioned above; the views given above are the personal views of the analyst.