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Nifty

Nifty started the week on a flat and extended positive momentum in the initial half however profit booking at higher levels erased most of the gains to end on flat note. Nifty closed at 17758 with a gain of 60 points on a weekly basis

On the weekly chart the index has formed a bearish candle with an upper shadow indicating selling at higher levels. This price formation also resemble to “shooting star” hence any down close in the following week may confirm this short term trend reversal pattern. The chart pattern suggests that if Nifty crosses and sustains above 17800 levels it would witness buying which would lead the index towards 18000-18300 levels. However if the index breaks below 17700 level it would witness selling which would take the index towards 17500-17300. Nifty is now well placed above its 20, 50, 100 and 200 Day SMA indicating positive bias in the short 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 18300-17400 with mixed bias.

The weekly strength indicator RSI is moving upwards and is quoting above its reference line indicating positive bias however the negative crossover on the daily chart signals price correction.

The trend deciding level for the day is 17820. If NIFTY trades above this level then we may witness a further rally up to 17930-18100-18210 levels. However, if NIFTY trades below 17820 levels then we may see some profit booking initiating in the market, which may correct up to 17650-17540-17365 levels.

Banknifty

Bank Index opened on a flat note and traded with positive bias in the initial half however profit booking at higher levels dragged index lower to close on flat note. Bank Nifty closed at 38986 with a loss of 56 points on a weekly basis.

On the weekly chart the index has formed a Bearish candle with a long upper shadow indicating profit booking as well as resistance at higher levels. The index is moving in a Higher Top and Higher Bottom formation on the daily chart indicating positive bias. The chart pattern suggests that if Bank Nifty crosses and sustains above 39300 level it would witness buying which would lead the index towards 39800-40400 levels. However if index breaks below 38700 level it would witness selling which would take the index towards 38000-37600. Bank Nifty is trading above 20, 50,100 and 200 day SMA which are important short term moving averages, indicating positive bias in the short to medium term. Bank Nifty continues to remain in an uptrend in the short term, so buying on dips continues to be our preferred strategy. For the week, we expect Bank Nifty to trade in the range of 40400-37600 with mixed bias.

The weekly strength indicator RSI is moving upwards and is quoting above its reference line indicating positive bias however the negative crossover on the daily chart signals price correction.

The trend deciding level for the day is 39200 If BANKNIFTY trades above this level then we may witness a further rally up to 39545-40110-40460 levels. However, if BANKNIFTY trades below 39200 levels then we may see some profit booking initiating in the market, it may correct up to 38635-38285-37725 levels

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