Nifty started the week on a flat note and witnessed a selling throughout the week - Axis Securities
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Nifty
Nifty started the week on a flat note and witnessed a selling throughout the week. However Friday's buying momentum at lower levels recovered some of the earlier losses. Nifty closed at 19517 on 04th August with a loss of 129 points on a weekly basis.
On the weekly chart the index has formed a bearish candle with either side long shadows indicating extreme volatility. The index is moving in a Higher Top and Higher Bottom formation on the daily chart indicating positive bias in a medium term. The chart pattern suggests that if Nifty crosses and sustains above 19650 level it would witness buying which would lead the index towards 19700-19800 levels. However if the index breaks below 19400 level it would witness selling which would take the index towards 19300-19200. On the daily chart, Nifty sustains above its 50, 100 and 200 day SMAs indicating positive bias in the medium term. Nifty continues to remain in an uptrend in the medium term, so buying on dips continues to be our preferred strategy. For the week, we expect Nifty to trade in the range of 19800-19200 with mixed bias.
The weekly strength indicator RSI is at the verge of crossover below its reference line. However momentum oscillator Stochastic has turned negative from the overbought zone indicating a possible consolidation or a profit booking in the near term
The trend deciding level for the day is 19495. If NIFTY trades above this level then we may witness a further rally up to 19560-19600-19660 levels. However, if NIFTY trades below 19495 levels then we may see some profit booking initiating in the market, which may correct up to 19455-19395-19355 levels
Bank Nifty
Bank Nifty started the week on a positive note and traded with extreme volatility on either side throughout the week. Bank Nifty closed at 44880 on 04th August with a loss of 589 points on a weekly basis.
On the weekly chart the index has formed a bearish candle forming lower High-Low compared to previous week and has closed below its low indicating weakness at current levels. The index continues to move in a Higher Top and Higher Bottom formation on the daily chart indicating positive bias in a medium term. The chart pattern suggests that if Bank Nifty crosses and sustains above 45000 level it would witness buying which would lead the index towards 45200-45350 levels. However if the index breaks below 45700 level it would witness selling which would take the index towards 44500-44400. Bank Nifty is trading above 50, 100 and 200 day SMA which is important short term moving averages, indicating positive bias in the short to medium term. Bank Nifty continues to remain in an uptrend in the medium term, so buying on dips continues to be our preferred strategy. For the week, we expect Bank Nifty to trade in the range of 45350-44400 with mixed bias.
The weekly strength indicator RSI and momentum oscillator Stochastic have both turned negative from the overbought zone and are below their respective reference lines indicating negative bias
The trend deciding level for the day is 44840 If BANKNIFTY trades above this level then we may witness a further rally up to 45160-45435-45755 levels. However, if BANKNIFTY trades below 44840 levels then we may see some profit booking initiating in the market, it may correct up to 44560-44240-43965 levels.
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