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Nifty Weekly

• Month of march displays a ‘Doji’ formation; indicating indecisiveness /pause to follow; Ideal formation ahead of the fresh quarter complimenting its April seasonality factor

• Seasonality data favors month of April to retain its neutral to positive bias. Past records state 5Yr. & 10Yr. avg. score remains positive with only year 2015 the index witnessed a major negative return of more than 3%

• Weekly strong candle closing above its 20 WEMA is a good sign of a strong rebound; follow through move could see a move towards the upper end of the channel cluster placed around 17650 zone

• Weekly strength indicators remain neutral to negative with ADX above 25; hence conviction to remain low while participating pullback up move

• Weekly options cluster indicates immediate support at 17300 while upper bounds are placed at 17500-17600

• Low rollover data with price trending near channel pattern support served as a good floor for a pullback move; expect the up move to trend towards the pattern resistance cluster around 17450-17600

• Expect index to retain within its oscillating range with multiple hurdles around 17520 (200 DEMA) to 17600 (78.6% retracement resistance) followed by 17650 (weekly Channel resistance zone)

• Despite of a truncated week price action to remain affirmative as sector rotation expected to remain robust throughout the week

Nifty Daily

Index witnessed a brief phase of pullback within the ongoing declining channel pattern formation. The upper end of the pattern is placed around 17600-17650 which should act as a supply zone while the pattern support remains declining at 16600. Though the headroom towards 17600 remains open; there are multiple hurdles starting with 17520 (200 DEMA).Its daily oscillators are placed well for an extension of the ongoing pullback but its weekly strength indicators remain diverging. Option data for the truncated week indicates immediate resistance around 17500 while 17300 could hold its support base. While participating the ongoing pullback move it’s ideal to remain cautious while carrying forward any aggressive positions until the price remains confined within this declining trend sequence. Lack of conviction could remain evident as indicators remain diverging but equally balanced. Therefore, its ideal to remain cautious during the week & focus on sector rotational moves for short term trading. Investors on the other hand should continue to focus on relatively stronger sectors & stocks which did well during the last 4-6 weeks to retain their relative price outperformance.

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