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Published on 29/06/2020 5:44:04 PM | Source: GEPL Capital Ltd

Weekly Technical Outlook - NIFTY IT weekly close 14994.70 (3.4%) By GEPL Capital

Posted in Market Outlook| #GEPLCapital Ltd #Market Outlook

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NIFTY IT weekly close 14994.70 (3.4%)

Observation

* Nifty IT has been forming a higher high higher low pattern since march 2020 after testing a low of 10991.

* The long term moving average on the daily time frame are as follows 20 Day SMA (14567) 100 Day SMA (14204) and the 200 Day SMA (14874). As of now the index is placed above all the above mentioned moving averages.

* On the indicator front the RSI (55.19) plotted on the weekly chart of NIFTY IT can be seen forming a higher high higher low pattern as the index moves higher indicating the presence of bullish momentum in the prices.

* In the previous week the index broke above the 61.8% retracement level and is making a move towards the 78.6% retracement level

* Going ahead we can expect the level of 15146 the 200 Week SMA to act as an immediate resistance level. If the index manages to break above this level we can expect further upside towards 15621 (78.6% retracement level of the fall from 16882-10991) followed by 15968.50 (1st Feb 2020 low)

* On the down side the crucial level to watch for are 14320.70 (Weekly Low) followed by a support zone of 14123-13940 (3 week low and 50% retracement level of the fall from 16882-10991)

Inference & Expectations

* The Index has been in a strong uptrend since march 2020

* We expect this up move to accelerate once the index breaks above the 15146 level then it may touch to 15621 followed by 15968 mark.

* On the flip side the crucial support level is placed at 14320.70 (Weekly Low). If this level breached then the prices would move lower and test the support zone of 14123-13940 (3 week low and 50% retracement level of the fall from 16882-10991).

 

NIFTY MEDIA weekly close 1402.10 (1.05%)

Observation

* In the previous week the Index attempted to break above the (50% retracement level of the fall form 1906-972) but failed to sustain above that level.

* The long term moving average on the daily time frame are as follows 20 Day SMA (1340.96), 100 Day SMA (1346.15) and the 200 Day SMA (1581). As of now the index is placed above the 20 DAY SMA and the 100 Day SMA but remains below the 200 DAY SMA.

* On the indicator front the RSI (49.80) plotted on the weekly chart can be seen facing slight rejection near the 50 level, indicating a tug of war between the bulls and bears.

* The crucial level to watch for on the upside are 1485.30 (Weekly high), followed by 1630 (11th OCTOBER 2019 low)

* The key level to watch for on the downside are 1329.40 (38.20% retracement level of the fall form 1906-972.85) followed by 1206-1237 (3 week low and multiple touch point level).

Inference & Expectations

* We witnessed, the Index has been facing rejection near the 50% retracement level of the fall form 1906-972).

* Currently the index seems to preparing for a down move with the formation of bearish Gravestone Doji candle pattern.

* We feel that, as long as the Index is below 1476 (50% retracement level of the fall form 1906-972) it would be in a Bearish mode and it may touch to the downside level of 1329.40 (38.20% retracement level of the fall form 1906-972.85) followed by 1206-1237 (3 week low and multiple touch point level).

 

IOB Weekly close 13.10 (31.70%)

Observation

* We witnessed a stellar up move in the previous week. It not only broke above but also managed to closed above the important resistance level of 12.80 and made fresh 52 week high.

* It ended the week with a strong Bullish Closing Marubozu candle pattern. This candle was backed by 2nd largest high volume till now. Indicating the strong participation in the up move.

* On the daily time frame the long term, moving averages are as followed 20 Day SMA (10.24), 100 DAY SMA (8.45), 200 DAY SMA (9.42). Currently the prices are placed above all the above mentioned moving averages.

* The momentum indicator RSI (72.20) plotted in the weekly time frame can be seen moving higher after breaking above the 50 level indicating the presence of bullish momentum in the prices.

* In the previous week the stock broke above the 12.53 (23.8% retracement level of the fall from 32.20-6.45), as of now it is heading towards the 16.29 (38.2% retracement level of the fall from 32.20-6.45).followed by 20.50 (11 Nov 2016 low)

* On the downside the crucial support is placed at 11.10 (12th June 2020 high) followed by 9.9-9.25 (weekly low followed by 3 week low)

Inference & Expectations

* The stock in the previous week had a fantastic up move and ended the week with a gain of 31.7%

* We see good upward potential in the stock, we expect the stock to move higher and test the high of 16.29 (38.2% retracement level of the fall from 32.20-6.45).followed by 20.50 (11 Nov 2016 low)

* This stock can be a good buy in dip opportunity, One can accumulate the Stock at every dip till 11 mark with strict stop loss of 9 on the closing basis.

 

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