NIFTY-Weekly Outlook-Venkat's Blog

Nifty saw a remarkable recovery snapping the three weeks of steep fall. As observed in the previous blog the reversal was sharper aided by short covering. Nifty index completed the eventful year with a decent 4.33% gain during the year. With 17777 holding for two consecutive weeks, we may see a consolidation during the ensuing week.

A few observations from the weekly charts are:
Weekly charts suggest that

• The index moved around 298 points viz. between 17774 and 18265
  the oscillators are showing mixed signals
  Option OI is expected to drive the market direction
  With 17770 holding the Index has made tweezer bottom and it ended up with a bullish candle
  
  

Expected scenarios for the ensuing week

Though closed at 18106, the Index is expected to open higher
The support at 177770 held and the index has made a remarkable recovery
A new Gap has been created viz. 18127-17977 got filled
Going forward the 18350-18470 zone, is likely to be a major barrier
For the ensuing week, the index may find supports at 18080, 17960, 17770, and the index could face resistances at 18180, 18270, 18360 & 18480


Additional interesting observations

*Not any major changes seen in FIIs and DIIs activities except 15k Cr option buying during the past week
Two possible scenarios
Expected range of 17960-18470 or 17770-18360
Any close outside the range of 17770-18470 requires re-assessment of risk

Final Note

*The crucial support at 17779 holding for two consecutive weeks give hope for some recovery and even a possible attempt closer to the recent peak.
Even at the cost of repetition the following two observations are reference values for the future
If we take the Fib retracements so far the correction has been 1108 points. The Annual gain has been 3704 points from 15183 to 18887. One third correction would fall at 17666 and a 50% correction would mean 17035
Most likely scenario would be a consolidation between 18k-18.5k

Seasons Greetings and Best wishes for a Happy New Year 2023






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