NIFTY WEEKLY REPORT & VIEW FOR NEXT WEEK 20 JULY TO 24 JULY 2020

WEEKLY RESISTANCE FOR NIFTY: 11000, 11200,11500

PIVOT POINT: 10700

WEEKLY SUPPORT FOR NIFTY:  10500, 10300, 10000

WEEKLY CHART FOR NIFTY

DAILY RESISTANCE FOR NIFTY: 11000, 11100, 11200
PIVOT POINT: 10800

DAILY SUPPORT FOR NIFTY:  10700, 10600, 10500
DAILY CHART FOR NIFTY

We started the new trading week with a decent upside gap, owing to favorable global cues. However, the index failed to extend the lead from thereon; in fact we witnessed a good amount of profit booking throughout the remaining part of the day to eventually conclude the session nearly 100 points off morning's high. Fortunately in the midst of this, Nifty managed to close in the green tad above the 10800 mark. On Tuesday, we had a painful session after few weeks of consistent rally. But things were completely different yesterday morning, due to massive overnight rally in US bourses. Our markets opened with a decent bump up which was then followed by an extension of the rally to go beyond the 10800 mark. However, post the Reliance AGM, markets took a complete nosedive due to heavy profit taking in RIL from record highs. Within no time, whopping gains of 200 points on Nifty just disappeared to conclude the day with negligible gain. On Wednesday Bulls took nifty above 10800 mark. Risk appetite was boosted after Moderna Inc's experimental vaccine for coronavirus showed it was safe and provoked immune responses in all 45 healthy volunteers in an ongoing early-stage study. expectation of  stimulus from the governments also boosted the market sentiments. The Sensex closed 18 points higher at 36051 while the Nifty settled 10 points higher at 10618. Wednesday’s tail end correction was followed by yet another gap up opening in our markets; courtesy to bumper opening in IT Giant, Infy post its stellar quarterly numbers. However, once again this hollow opening got sold into as markets cooled off in initial trades. For the major part of the day, index traded on a flat to positive note. All of a sudden, at the stroke of the penultimate hour, the buying momentum accelerated to conclude the weekly expiry well above 10700 mark by recouping major portion of previous day’s losses. On Friday markets registered sharp gains on Friday, as investors hoped for strong corporate earnings to continue after HCL Technologies became the third IT major to report upbeat profit, offsetting concerns over surging COVID-19 cases in the country that crossed the 1 million mark. The Nifty climbed to as high as 10933. 

NIFTY: A STRONG SUPPORT WILL BE @ 10500; STRONG RESISTANCE LEVEL SEEN @11200

Nifty surpass the barrier of 200-SMA. If we have to take out any positives from this week move, the only thing that comes to our mind is the closing of Nifty above 10900. For the coming session, 11000 becomes the immediate resistance; whereas 10600 followed by 10500 would be seen as intraday supports.

TECHNICALLY SPEAKING.

In the midst of all this, the Nifty concluded the week with moderate gains of one and half percent. It’s been a stellar Bull run for our markets since the March lows and markets never looked back to reach the crucial zone of ‘200- SMA’ on daily chart. The kind of lethargic activity we witnessed in the week gone by was quite evident, because the market has seen a relentless move without any major halt in between and has reached such a crucial junction. Firstly,as mentioned the key moving average of 200-SMA on a daily chart. This coincides with the Weekly 89-EMA as well as monthly 20-EMA and hence, the bulls had to respect them. Ideally, if the market has to correct, this is the perfect zone from where it can. In fact, in the previous article, we had clearly advocated booking profits in the ongoing rally in the zone of 10900-11200 and we continue to do so at least for momentum traders. But by no means, we advise going short on the market because the momentum in individual stocks is still strong and importantly, we are seeing a consensus opinion about the market correcting from current levels. As we all know, when everyone expects a fall, it never comes and vice versa. So, in our sense, the Nifty would first surpass the 11000 mark and head towards the 78.6% retracement zone of the entire fall i.e. 11200-11500, where we can actually see some profit booking taking place. If consensus view has to fail, this possibility cannot be ruled out. Any assumption needs a proper exit strategy if not worked as per the expectation. Hence, in this scenario, the hypothesis remains valid as long as the crucial support of 10700-10500 remains intact. A breach of mentioned supports would certainly trigger a decent profit booking in the market and hence, keep a tab of all the mentioned possibilities and key levels. It would be important to highlight that the banking space holds a key in all this and hence, all eyes would be on its heavyweight constituents as well.