Nifty and Banknifty Analysis for this week.
From 14th to 18th September.
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Technical analysis of Nifty and Banknifty
Daily chart of NIFTY50
Bearish candle formation in NiFTy50 but strong bounce back from the lower side which Nifty50 trying to break. RSi is below 60 suggesting further weakness in NiFTy50 and has to break Friday’s high for Upside.
Weekly chart of Nifty50
See all the past candles , you won’t see Doji candle in past 10-12 weeks. This suggest the bull run we had in past , might take a break as bears getting hold now. If RSI slide below 60 just like daily chart more weakness possible.
Nifty bank in weekly chart formed Bearish candles , not perfect Marubozu but with some variation . It indicate two things that Trend is still bearish but second important thing is Nifty bank already fallen much so possibility of some upside here. But interesting to see if it survive ?? Or not ?
SUPPORT and RESISTANCE
As of now Nifty has strong Trend line Resistance near 11600 and fresh rally on the upside will be only above 11600 mark. On the downside if 11600 not broken then we see Nifty heading for 11000-11100, but Nifty50 has support near 11350 and 11250 which has to break.
For Nifty bank
On the upside Nifty bank has strong resistance near 23000-23200 zone , but immediate resistance is 22500.
Now for downside 22000 is crucial level as Trend line Support but much crucial and very much deciding factor will be 21000 mark and it will act as make or break level for Nifty bank.
Moving average -:
11436 is 20 day EMA for Nifty50 and today’s low for Nifty50 is 11446. So 20 day EMA is acting as support . Nifty50 also closed above 5 day EMA at 11510. Both will be immediate support zone for Nifty50.
On the contrary , in case of Nifty bank it broke 5 day , 20 day and 50 day EMA which. Be acting as resistance for Nifty bank.
Heikin Ashi -:
Hekin Ashi shows an accurate trend, but it’s lagging in the Indicator as it follows previous candle prices.
For Nifty Hekin ashi chart as you can see after Green candles there is a Doji candle In Nifty50 suggesting a Bullish reversal sign.
For Nifty bank
Though it’s ongoing bearish trend as you can see Red candles in flow. But interesting thing is there was no upper shadow before and now it’s appearing in recent candle suggesting Bulls are trying to come back after big downside in Nifty bank but no reversal sign yet.
My view on Nifty and Nifty bank -:
For Nifty50 and Nifty bank
Nifty50 I feel will fall from here and the downside will be more unless it breaks 11600. The trend line less likely to break on the upside , and on the downside 12350-11250 are two support but sooner or later Nifty50 will go near the Trend line support of 11000-11100.
Do we have to invest or not ?? Yes, you can but be stock specific rather market-specific. Don’t jump to 6-7-8k for Nifty50 yet as multiple supports are lined up. You can watch the bank for Investment in cash and short term gain. Why ??
Nifty bank is falling last 3 weeks continuously so it’s respecting 22000 and if broken then less likely to break 21000 too. So there is a possibility of one bounce dead or strong we don’t know yet but one bounce might come if it breaks Friday’s high.
PCR ratio for Nifty50 is 1.023 and for Nifty bank, it’s 0.656 which underlines the same thing that Nifty bank is oversold and will show a bounce but Nifty will slide down as it’s in the neutral zone unless break 11600.
Stocks of the week
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First, check the weekly chart of Sunpharma which indicates the stock is taking strong support near 20 weekly EMA and less likely to break. If it comes there it will be a great buying price.
Now see monthly chart
As you can this stock is capable enough to touch 1000 also but right now going in discount also started recovery as well on lower side. Now forget 1000 even if stock touch 700-800 in coming months still it’s more than 30% returns. Also don’t forget pharma is safe heaven in this pandemic and Sunpharma yet to show it’s big rally on the UP.
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