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Nifty

Nifty opened with a downward gap and traded with extreme volatility on either side and gained bullish momentum at the end of the day. Nifty closed at 19465 on 16thAugust with a gain of 30 points.

On the daily chart the index has formed a bullish candle with a lower shadow indicating buying at lower levels. This support zone is characterized by a convergence of horizontal support and the 50-day Simple Moving Average (SMA). The index continues to move in a lower top and lower bottom formation on the hourly chart indicating negative bias In a short term. The chart pattern suggests that if Nifty crosses and sustains above 19500 level it would witness buying which would lead the index towards 19550-19650 levels. Important supports for the day are around 19400 however if index sustains below 19400 then it may witness profit booking which would take the index towards 19300-19250 levels. Nifty is trading above 50, 100 and 200 day SMA indicating positive bias in the medium term. Nifty continues to remain in an uptrend for the medium term, so buying on dips continues to be our preferred strategy.

The daily RSI remains flat and below its reference line, suggesting a neutral momentum with no clear direction.

The trend deciding level for the day is 19420. If NIFTY trades above this level then we may witness a further rally up to 19525-19585-19690 levels. However, if NIFTY trades below 19420 levels then we may see some profit booking initiating in the market, which may correct up to 19360-19255-19195 levels.

Bank Nifty

Banknifty opened lower with a downward gap and extended selling momentum in the first half however buying momentum at lower levels erased some of the earlier losses. Banknifty closed at 43946 on 16th August with a loss of 145 points.

On the daily chart the index has formed a small bullish candle with shadows on either side representing extreme volatility as well as indecisiveness amongst participants regarding the direction. The index continues to move in a lower top and lower bottom formation on the hourly chart indicating negative bias in a short term. The chart pattern suggests that if Nifty crosses and sustains above 44100 level it would witness buying which would lead the index towards 44200-43400 levels. Important supports for the day are around 43800 however if index sustains below 43800 then it may witness profit booking which would take the index towards 43700-43600 levels. Banknifty is sustaining above its 100 and 200- day SMA which signals bullish sentiments in near term. Banknifty continues to remain in an uptrend in the medium and long term, so buying on dips continues to be our preferred strategy.

The daily strength indicator RSI is moving downwards and is quoting below its reference line indicating profit booking.

The trend deciding level for the day is 43850. If BANK NIFTY trades above this level then we may witness a further rally up to 44100-44250-44500 levels. However, if BANK NIFTY trades below 43850 levels then we may see some profit booking initiating in the market, which may correct up to 43695-43445-43295 levels.

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