NIFTY WEEKLY OUTLOOK & OPTION CALL PUT TIPS FOR 9 MARCH TO 13 MARCH 2020

WEEKLY RESISTANCE FOR NIFTY: 11000, 11200,11500

 PIVOT POINT: 10800

WEEKLY SUPPORT FOR NIFTY:  10700, 10600, 10500

WEEKLY CHART FOR NIFTY

DAILY RESISTANCE FOR NIFTY: 11050, 11100, 11150
PIVOT POINT: 10900
DAILY SUPPORT FOR NIFTY:  10850, 10800, 10750
DAILY CHART FOR NIFTY

Market is badly affected by the coronavirus in this past week. Nifty closed the week below 11000 mark. The Nifty had a huge nose dive in this week. Overnight weak global cues along with troubles in the banking sector took toll on the Nifty as it shed around 300 points on Friday 06 March 2020. The sell-off in the market was triggered by weak global trend due to coronavirus outbreak, restricting international travel and trade. Additionally, moratorium enlarged domestic concern over safety of financial system and Indian rupees weaken past 74 levels due to these issues. The bailout is a positive development lowering long-term systemic problems and will increase safety for depositors.

At the close of week, the Sensex was down 894 points at 37576, and the Nifty was down 279 points at 10989. Our markets started with a huge gap up opening around the last Friday’s high. Subsequently, Index traded in a range with a positive approach for the major part of the session. However, the last hour news of two cases found of coronavirus in Delhi and Telangana created havoc which erased morning gains of more than 200 points and in fact ended with cuts of 69 points at 11133 levels. Quite similar to the Monday’s session, our markets witnessed a gap up opening however in Tuesday session the bias remain buoyant as Nifty ended with gains of 1.53% tad above 11300. The Nifty index started Wednesday session marginally positive and traded in a range till noon. However, it corrected sharply to retest the support zone of 11100-11000 and then pulled back higher in the last hour to end with a loss of about 50 points. The indices oscillated within a range of 150 points on Thursday and ended the session with marginal gains.

TUESDAY MARKET WILL BE CLOSED DUE TO OCCASION ON HOLI

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

Market will be watchful about the final resolution to be offered by RBI & SBI soon. We continue to maintain our cautious view on Indian markets and expect volatility to remain high in the near term. The updates on spread of Coronavirus cases would be the single biggest factor dictating global markets going forward. On the domestic front, updates on resolution plan for Yes Bank along with spread of Coronavirus cases would be actively tracked by traders and investors. Technically, with the Nifty moving down further, the short term trend remains down. The Nifty could test the recent lows of 10800-10700 in the coming week. Any pullback rallies could find resistances at 11050-11100.

TECHNICALLY SPEAKING.

Technically, the Nifty for last more than six months is trading in a rising channel pattern and Friday’s opening sell-off got defended precisely around the lower end of this pattern. Now in the last one week Index has broken major supports with ease however with oscillators placed into the oversold territory; the lower end of rising channel pattern coinciding around the psychological level of 10800 is the last ray of hope. On the flip side, last Friday's huge gap area of 11384 - 11536 remains an immediate hurdle. The volatility is haunting traders on the both sides of the trend and hence traders are advised to keep positions light until we see some stability. If the index breaches the support of 10800 with a gap, it may lead to some panic selling as well and hence, it would be better for short term traders to stay on the sidelines and light on positions. With the gigantic gap down opening the index breached certain crucial supports including the psychological level of 11000. In terms of the price pattern, the Nifty has broken down from a multi month Ending Diagonal pattern. This shows that the index is in a downtrend not only for the short term but also for the medium term. The pattern breakdown of such a scale has significantly bearish implication which pegs the medium term target at 10000. From short term perspective, 10630 & 10480 will be the key targets to watch out for. On the flip side, 11100-11200 will now act as a near term resistance zone. Money management becomes a crucial tool in such volatile times and hence, traders are advised to manage the risk properly.