NIFTY WEEKLY REPORT & VIEW FOR NEXT WEEK 22 JUNE TO 26 JUNE 2020

WEEKLY RESISTANCE FOR NIFTY: 10397, 10604,10873 

PIVOT POINT: 10149

WEEKLY SUPPORT FOR NIFTY:  10026, 9830, 9654

WEEKLY CHART FOR NIFTY

DAILY RESISTANCE FOR NIFTY: 10289, 10485, 10608

PIVOT POINT: 10113

DAILY SUPPORT FOR NIFTY:  10213, 10171, 10003

DAILY CHART FOR NIFTY

Last Friday’s v-shaped recovery turned out to be a deception for most of the bulls and including us, most of the participants expected a good start of the week. The rising concerns over the second wave of coronavirus is haunting market participants across the globe. The US markets had fallen nearly 10% last week and Monday morning, the start for the Dow Jones Futures was very much in continuation with this sell off. These clearly had a rub off effect on our markets as well and hence, post the moderate gap down opening on Monday; we extended losses in the first half to test sub-9750 levels. Fortunately, the damage was not as severe as it was looking at one point. Due to decent recovery in the last couple of hours, the Nifty managed to reclaim the 9800 mark at the close on Monday. When we closed on Monday, DOW future was trading deeply in red and there was complete turnaround seen overnight. US markets saw v-shaped recovery to close well inside the positive territory and Tuesday morning too the DOW future started with a bang. Undoubtedly we had to follow these cues and as a result, we started with a good bump up at the opening beyond the 10000 mark. Post this, market consolidated and looked a bit uncomfortable at higher levels. After Tuesday’s wild swings, on Wednesday our markets started slightly lower on the back of sluggish negative cues. However, the initial decline was immediately bought into and thereafter index slipped into a consolidation mode. In the midst of this, index slowly and gradually moved towards the 10000 mark. However, once again we failed to sustain at higher levels and saw a decent dip in last one hour of trade to conclude with nominal cut.

Our markets were undergoing some stressful atmosphere ever since the news came out of the scuffle at the India-China border on Tuesday. Hence, we could see our markets struggling at higher levels and were trading around the lower end of the consolidation range. Thursday morning, it was surprising to see that we started on a flat note despite Global markets were trading strongly in red and Nifty too indicated a gap down opening below 9800. Throughout the day, we maintained our positive posture and with the help of strong surge in the latter half, the Nifty managed to clock handsome gains over two percent. On Friday The Sensex was up 500 points at 34764 levels and the Nifty50 index hovered around 10210-mark. It has been good week for the global markets as positive sentiment on reopening the economies overshadowed reports of fresh covid cases in the US and China. Market mood was supported by a gradual resumption in business activities and an earlier-than-expected normalization in certain consumption sectors.
NIFTY: A STRONG SUPPORT WILL BE @ 9654; STRONG RESISTANCE LEVEL SEEN @10572

The next week could be the trend deciding sessions. At our end, we still remain hopeful and expect the Nifty not to fall below 9500 now. Before this, 9830 – 9654 can be seen as weekly supports. On the flipside, 10298 – 10508 remains to be a sturdy wall and if the index has to regain any strength, it needs to again enter 11000 soon.

TECHNICALLY SPEAKING.

Barring last two sessions, our market was undergoing a consolidation phase, but the range widened a bit towards the fag end. Broadly speaking, in the midst of all this, our markets retraced recent up move and managed to reclaim the resistance of 10200. If you refer to our recent post, for us, the trend changing level was 10000 and although it was breached in this week closing, we will give more weightage for closing levels. Nifty has not only reclaimed it on a daily basis but with Friday’s close, it has been defended on a weekly basis as well. Hence, we continue to remain upbeat and construe this decline as a retracement of the recent up move, which was very much needed to provide the strength for the next leg of the rally. As far as supports are concerned, 10171 continue to be seen as key support on closing basis. But with today’s move, we can mention a slightly bigger support zone of 10000 – 9800 for the coming week. On the flipside, we expect Nifty to go 10300 – 10500 or may even head towards 10700 – 11000 levels. One of the key rationales behind this hypothesis is the overall positioning of the Bank Nifty. Couple of weeks back, we could see confirmation of a positive crossover in ‘RSI-Smoothened’ on the weekly chart. Historically it's proven that when this kind of crossover happens in this oscillator, it has the tendency to give bigger moves and hence, this observation is adding conviction to our optimistic stance. After the rally in current month, investors need to be cautious in the near-term and watch out for geopolitical developments between India and China on one hand and valuations on the other. Resurgence of covid cases and reports of a second wave of infections are potential risks for the markets.