NIFTY-Weekly Outlook-Venkat's Blog

Though the Bulls were in control, there seems good supply coming in at higher levels. The Index was struggling to cross the key resistance at 22520-30 region. However, on the weekly Option expiry day it opened with a gap and then slid all the way to the lows of the week and finally closed higher. Now that the Index is back in the original channel and is expected to consolidate before taking further direction. The price action as well suggests the likely consolidation phase.

A few observations from the weekly charts are:

• The index moved in a narrow range of 316 points viz. between 22303 and 22619
  
• The oscillators of different time frames are stretched and showing mixed signals
  
• Option open interest to drive the direction of the market
  
• Expected scenarios for the ensuing week
  
• Volatility and choppy moves likely to continue
  
• Index regaining the 22220 a positive sign
  

Additional interesting observations

• Index posted a bullish candle and re-entered the minor trend channel and made a new ATH
  
• Index may find supports at 22370, 22220, 22170 and the index could face series resistances at, 22620, 22740, 22870
  
• There were multiple gaps created during this dream run. The levels were repeatedly mentioned in the previous blogs. Since they are far away for now, they will be inserted back when relevant
  

Final Note

• The Index has stayed well above 55 DMA at 21995 and the 200 DMA at 20473
  
• The weekly charts suggest that the Index is back in the previous channel after bouncing back from 55DMA
  
• The notable observation is that the daily charts show signs of turn-around of Oscillators and expect 21220 to hold.
  
• Most likely scenario would be a consolidation between 22220 & 22740. Breach on either side requires reassessment of risk
  
• In the past few years the April month has produced higher levels yet the closing has been mixed. It remains to be seen how the scenario unfolds
  
• The Index crossed 22525 barrier and created a new ATH. However, it got sold-off once before recovering from 22300 to close around the same 22520 zone.
  
• The Q4 results expected to be positive and keep the markets at higher levels. However, the uncertainties on account of the forth coming elections would keep the gains subdued
  
• Ensuing week is crucial for deciding the future direction and the target
  
• Going by the technical indicators the broader range for April is 21920-22765. Breach on any side requires re-evaluation
  

#Stay Safe

Disclaimer: The views expressed here are personal and not connected to SYFX Treasury Foundation. The views are for learning and reference purpose only.