NIFTY WEEKLY OUTLOOK & OPTION CALL PUT TIPS FOR 10 FEB TO 14 FEB 2020

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WEEKLY RESISTANCE FOR NIFTY: 12150, 12250,12350

 PIVOT POINT: 12050

WEEKLY SUPPORT FOR NIFTY:  12000, 11900, 11800

WEEKLY CHART FOR NIFTY

DAILY RESISTANCE FOR NIFTY: 12100, 12150, 12200

PIVOT POINT: 12075

DAILY SUPPORT FOR NIFTY:  12050, 12000, 11950

DAILY CHART FOR NIFTY

Nifty started the week at all time high level 12400 marks but all this ecstasy did not last too long. The markets started giving up right from the word go and before anyone could realize, we were significantly off the opening highs to enter a negative territory. In fact, things worsened as the day progressed and eventually, Nifty and Bank Nifty concluded the Monday’s session with severe cuts. Post the sell-off in Monday's session, the index opened Tuesday’s session marginally negative following the global cues. Nifty traded within a range of 70 points and ended the day with a loss of almost half a percent. The Nifty started trading for the Wednesday’s session on a positive note above the 12200 mark. However, it failed to show any follow up move post opening and corrected for the rest of the session to end with a loss of another half a percent. The Nifty opened marginally positive on Thursday and traded with a positive bias on the day of the weekly F&O expiry. It ended the session tad below 12200 mark with gains of six tenths of a percent. Shrugging off a weak start, Indian markets posted strong gains on Friday. The Sensex ended 226 points higher at 41613 while the Nifty ended the week 0.5% higher at 12248. Traders/Investors are now keeping a close watch on the February 1 budget for clues on the government's move to revive economic growth, which has slipped to a more than six-year low. Halting its four-day gaining streak, equity market ended in the negative territory on Friday amid worries over economic damage from the coronavirus outbreak and profit-booking in some of the recent outperformers. The  Nifty ended at 12086, down 51 points. 

NIFTY: A STRONG SUPPORT WILL BE @ 12000; STRONG RESISTANCE LEVEL SEEN @12250

Next week is likely to see a muted start, with 12100 and 12200 levels acting as strong resistance. Support may come in at 12000 and 11900. In the event of any consolidation, we may see the trading range getting broader than usual. In line with this, initial part of the week, index remained sideways and was clearly bucking the trend by not correcting as much as our benchmark did.

TECHNICALLY SPEAKING.

In just a matter of three weeks, the Nifty has corrected sharply from 12400 to almost test the 11600 mark and it tested the '200 SMA' after mid-October 2019. Around this support, there are other indicators such as 161% reciprocal retracement of the rise from 11929 to 12430 and the 50% retracement of the entire up move from 10650 to 12425 which coincides in the range of 11875-11670. Although the market breadth was even-steven, many of the recent outperformers from the broader markets witnessed buying momentum with good volumes which was a positive sign. Technically, since we have already corrected sharply and are now in the vicinity of the support zone, a pullback move could be seen and hence, traders are advised to avoid taking a contra call here. In this week, the Nifty has resumed the positive momentum and has given a V-shaped recovery from its '200 DMA' support. The momentum readings on the lower time frame chart are into overbought territory and the index has reached its short term resistance around 12150. However, on the price front, there are no signs of weakness as the broader markets too have been doing well. Hence, traders are advised to continue to trade with the trend and look for stock specific trading opportunities with a positive bias. The immediate support for the Nifty is placed around 12000 whereas resistances are seen around 12150- 12200 followed by 12300. On the candles, a Spinning Top was formed. Such a formation has a small real body and a very little difference between the open and the close prices. Spinning Tops often suggest exhaustion, and this can potentially halt the direction of the trend for some time. However, this requires confirmation on the next session. Even in the event of some upmove, we would suggest traders put emphasis on profit booking than making new purchases. The Relative Strength Index (RSI) on the chart was at 52.31 and stayed neutral, showing no divergence against the price. The MACD remained bearish and continued to trade below its signal line.