Bank Nifty started the week on a positive note but witnessed selling at higher levels to end the week on weak note - Axis Securities
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Nifty
Nifty started the week on a flat note and witnessed selling pressure throughout the week which dragged the index to close at its lowest point. Nifty closed at 17026 with a loss of 738 points on a weekly basis.
On the weekly chart the index has formed a long bearish candle forming lower High-low compared to previous week indicating further weakness. The index is moving in a Lower Top and Lower Bottom formation on the daily chart indicating negative bias. The chart pattern suggests that if Nifty crosses and sustains above 17300 level it would witness buying which would lead the index towards 17500-17700 levels. However if index breaks below 17000 level it would witness selling which would take the index towards 16800-16500. Nifty is trading below 20,50 and 100 day SMA's which are important short term moving averages, indicating negative bias in the short to medium term. Nifty continues to remain in a downtrend in the short to medium term, so selling on rallies continues to be our preferred strategy. For the week, we expect Nifty to trade in the range of 17300-16500 with a negative bias.
The weekly strength indicator RSI and momentum oscillator Stochastic have both turned negative and are below their respective reference lines indicating negative bias.
The trend deciding level for the day is 17125. If NIFTY trades above this level then we may witness a further rally up to 17260-17490-17630 levels. However, if NIFTY trades below 17125 levels then we may see some profit booking initiating in the market, which may correct up to 16890-16755-16520 levels.
Banknifty
Bank Nifty started the week on a positive note but witnessed selling at higher levels to end the week on weak note. Bank Nifty closed at 36026 with a loss of 1951 points on a weekly basis.
On the weekly chart the index has formed a sizable bearish candle and closed below previous week's low indicating weakness on a short term basis. The index is moving in a Lower Top and Lower Bottom formation on the daily chart indicating negative bias. The chart pattern suggests that if Bank Nifty crosses and sustains above 36400 level it would witness buying which would lead the index towards 36800-37500 levels. However if the index breaks below 35900 level it would witness selling which would take the index towards 35400-34800. Bank Nifty is trading below 20,50 and 100 day SMA's which are important short term moving averages, indicating negative bias in the short to medium term. Bank Nifty continues to remain in a downtrend in the short to medium term, so selling on rallies continues to be our preferred strategy. For the week, we expect Bank Nifty to trade in the range of 37000-34800 with mixed bias.
The weekly strength indicator RSI and momentum oscillator Stochastic have both turned negative and are below their respective reference lines indicating negative bias.
The trend deciding level for the day is 36265 If BANKNIFTY trades above this level then we may witness a further rally up to 36630-37230-37595 levels. However, if BANKNIFTY trades below 36265 levels then we may see some profit booking initiating in the market, it may correct up to 35665-35300-34700 levels.
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