Nifty 50 IndexShort
NIFTY ANALYSIS AND WEEKLY PICKS
NIFTY ON 18-11-2022
Index opened with a marginal gap up near the resistance level of 18400 and with no surprise continued to show weakness and fell from the day of 18394 to retest 18200.
I believe the readers who have been following the posts must not be surprised as we had discusses in the previous post that the technical indicators are giving strong signals that Index may retest 18210 on Friday.
Index took support from the day low of 18209.80 and a sharp recovery pulled the Index towards 18300.
Weakness was seen in all vital indices. AUTO and PHARMA suffered the highest losses with 1.18% and 0.72% respectively.
Howsoever, Index succeeded to defend 18300 on closing basis but will this be sustainable? This is another point of discussion which we will discuss in the later part of the Blog.
Technical View : (Daily Chart)
NIFTY has made a Bearish candle with a Long Lower shadow which reflects the buying has come from lower levels.
NIFTY is moving above EMA 13, 21, 34 and EMA 34< EMA21<EMA13 which can be interpreted as the positive trend is intact.
RSI has fallen to 63.91 from 65 level indicates that Index has lost the momentum in line with the Lower Highs Lower Lows candle formation.
Support and Resistance: Daily Chart
18210-18118 will work as first support level for NIFTY. Below this 18040 will work as strong support level.
18360-18400 will work as resistance. The next resistance level is not provided keeping in view that there are very low chances that Index will be able to cross the first resistance level itself.
SECTORAL VIEW (WEEKLY CHART)
BANK and FINANCIAL SERVICES look stronger on Weekly Charts.
Hence, Investors may look for the buying opportunities in these sectors if there comes a dip.
Trend reversal may be observed in METAL and IT.
AUTO, PHARMA and FMCG may continue to show the weakness.
View for Traders:
In the first section of the Blog, it is mentioned that the discussion over the sustainability of 18300 will be done in the later part of the Blog and let us start from that only.
The first question is why it is needed to discuss this, as Index has shown sharp recovery from the second support level of 18200 and already closed above 18300.
There are two reasons behind this which are as follow:
1. Index has a tendency to move towards EMA 13 level and this is applicable in either of the cases.
2. The first fall in the Index is always bought.
Hence, if we analyse the Index the Index has recovered from the EMA 13 level which stands at 18188. Also the buying has come from the second support level of 18210.
So, these two are sending the mixed signals while analysed in a combination.
I hope the reason behind the suspicion is cleared to the readers.
So for now we must analyse the Index on the basis of technical indicators and it shows that the chances of weakness is higher in the upcoming trading sessions ( which we have already discussed in the former part of the Blog).
On positional basis if we follow the Fibonacci retracement level then there are high chances that Index will retest 18040 in the upcoming trading sessions.
Further, no positive indications are coming from Global platform.
FIIs data is also indicating towards the weakness in the Index.
So, concluding all these three factors Technical, Global and FII data I am of the view that short term trend is Negative and Index will continue to reveal weakness and there are high chances that it may retest 18040 in upcoming trading sessions.
Hence, for tomorrow, Sell NIFTY in the range of 18300-18325 for a target of 18210-175. SL may be put above 18360 on closing basis.
The strong buying range of NIFTY lies near 18050 however, a Buying trade may be initiated in the range of 18150-110 for a target of 18200-225. SL may be put below 18090 on closing basis.
WEEKLY PICKS
1. POWER FINANCE CORPORATION
Buy in the range of 122-122.50
Target 130
SL 118
Potential Upside 6.55%
2. ICICI LOMBARD GENERAL
Buy in the range of 1118-1122
Target 1212
SL 1090
Potential Upside 8.40%
3. PUNJAB NATIONAL BANK
Buy in the range of 42-42.50
Target1: 48 Target 2: 55
SL 38
Potential Up-side : 14%
4. AXIS BANK
Buy in the range of 805-810
Target 865
SL 775
Potential Upside 7.45%
5. IFB INDUSTRIES
Buy in the range of 1055-1060
Target 1200
SL 1025
Potential Upside 13.74%
Index opened with a marginal gap up near the resistance level of 18400 and with no surprise continued to show weakness and fell from the day of 18394 to retest 18200.
I believe the readers who have been following the posts must not be surprised as we had discusses in the previous post that the technical indicators are giving strong signals that Index may retest 18210 on Friday.
Index took support from the day low of 18209.80 and a sharp recovery pulled the Index towards 18300.
Weakness was seen in all vital indices. AUTO and PHARMA suffered the highest losses with 1.18% and 0.72% respectively.
Howsoever, Index succeeded to defend 18300 on closing basis but will this be sustainable? This is another point of discussion which we will discuss in the later part of the Blog.
Technical View : (Daily Chart)
NIFTY has made a Bearish candle with a Long Lower shadow which reflects the buying has come from lower levels.
NIFTY is moving above EMA 13, 21, 34 and EMA 34< EMA21<EMA13 which can be interpreted as the positive trend is intact.
RSI has fallen to 63.91 from 65 level indicates that Index has lost the momentum in line with the Lower Highs Lower Lows candle formation.
Support and Resistance: Daily Chart
18210-18118 will work as first support level for NIFTY. Below this 18040 will work as strong support level.
18360-18400 will work as resistance. The next resistance level is not provided keeping in view that there are very low chances that Index will be able to cross the first resistance level itself.
SECTORAL VIEW (WEEKLY CHART)
BANK and FINANCIAL SERVICES look stronger on Weekly Charts.
Hence, Investors may look for the buying opportunities in these sectors if there comes a dip.
Trend reversal may be observed in METAL and IT.
AUTO, PHARMA and FMCG may continue to show the weakness.
View for Traders:
In the first section of the Blog, it is mentioned that the discussion over the sustainability of 18300 will be done in the later part of the Blog and let us start from that only.
The first question is why it is needed to discuss this, as Index has shown sharp recovery from the second support level of 18200 and already closed above 18300.
There are two reasons behind this which are as follow:
1. Index has a tendency to move towards EMA 13 level and this is applicable in either of the cases.
2. The first fall in the Index is always bought.
Hence, if we analyse the Index the Index has recovered from the EMA 13 level which stands at 18188. Also the buying has come from the second support level of 18210.
So, these two are sending the mixed signals while analysed in a combination.
I hope the reason behind the suspicion is cleared to the readers.
So for now we must analyse the Index on the basis of technical indicators and it shows that the chances of weakness is higher in the upcoming trading sessions ( which we have already discussed in the former part of the Blog).
On positional basis if we follow the Fibonacci retracement level then there are high chances that Index will retest 18040 in the upcoming trading sessions.
Further, no positive indications are coming from Global platform.
FIIs data is also indicating towards the weakness in the Index.
So, concluding all these three factors Technical, Global and FII data I am of the view that short term trend is Negative and Index will continue to reveal weakness and there are high chances that it may retest 18040 in upcoming trading sessions.
Hence, for tomorrow, Sell NIFTY in the range of 18300-18325 for a target of 18210-175. SL may be put above 18360 on closing basis.
The strong buying range of NIFTY lies near 18050 however, a Buying trade may be initiated in the range of 18150-110 for a target of 18200-225. SL may be put below 18090 on closing basis.
WEEKLY PICKS
1. POWER FINANCE CORPORATION
Buy in the range of 122-122.50
Target 130
SL 118
Potential Upside 6.55%
2. ICICI LOMBARD GENERAL
Buy in the range of 1118-1122
Target 1212
SL 1090
Potential Upside 8.40%
3. PUNJAB NATIONAL BANK
Buy in the range of 42-42.50
Target1: 48 Target 2: 55
SL 38
Potential Up-side : 14%
4. AXIS BANK
Buy in the range of 805-810
Target 865
SL 775
Potential Upside 7.45%
5. IFB INDUSTRIES
Buy in the range of 1055-1060
Target 1200
SL 1025
Potential Upside 13.74%
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