NIFTY WEEKLY REPORT FOR EXPIRY WEEK 31 AUG TO 4 SEP 2020

OFFER CLOSING ON 31 AUGUST 2020

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WEEKLY RESISTANCE FOR NIFTY: 11750, 11900,12000

PIVOT POINT: 11600

WEEKLY SUPPORT FOR NIFTY:  11500, 11400, 11300

WEEKLY CHART FOR NIFTY

DAILY RESISTANCE FOR NIFTY: 11700, 11750,11800
PIVOT POINT: 11630

DAILY SUPPORT FOR NIFTY:  11600, 11550, 11500
DAILY CHART FOR NIFTY

Markets across the globe were quite cheerful Monday morning and hence, we too started the week higher above the 11400 mark. As the day progressed, the positive momentum reinforced after a brief pause; courtesy to smart surge in banking conglomerates. Eventually, the nifty continued it’s march towards 11500, marking highest level since March fiasco. Global markets are clearly enjoying their dream run and the winning streak continued monday night and Tuesday morning as well. As a result, despite Nifty indicating a sluggish start, our markets opened higher above the 11500 mark. However, Nifty failed to extend the optimism as we saw couple of sharp swings of profit booking from day’s high. Fortunately, we managed to defend key levels and with the help of a gradual recovery towards the fag end, the Nifty ended session with negligible gains. Despite sluggish global cues, our markets started the Wednesday marginally higher above the 11500 mark. Subsequently, index remained in a slender range for the major part of the day. However, all of a sudden, strong buying momentum triggered at the stroke of the penultimate hour in some of the banking heavyweights, resulting in a spike of 50-60 points in Nifty to post the highest close beyond 11500 in the last six months. Thursday morning, global bourses looked a bit sluggish but despite this, our markets started off with a bump up above the 11600 mark. At the opening itself, Nifty and Bank Nifty marked their new six month highs. But this was followed by a period of complete lull in the market, thereby making it extremely dull expiry. For the major part of the day, Nifty kept gyrating in a slender range of 25-30 points and eventually with a small decline, Nifty ended the day with negligible gains; but the August expiry panned out quite well above the 11550 mark. Market finished higher for the sixth consecutive session on Friday. Sensex surged 354 points to close at 39467; while the Nifty settled close to 11650-mark.

NIFTY: A STRONG SUPPORT WILL BE @ 11300; STRONG RESISTANCE LEVEL SEEN @12000

Due to last 2 days’s of this week lethargic activity, we do not see any major development on the chart. As far as the resistances are concerned, 11800-12000 remains to be the levels to watch and on the downside, 11500 followed by 11300 should be treated as key supports going forward. The approach pretty much remains the same; where one should avoid index specific trade for a while (at least on the long side) and should focus on individual stocks by following strict stop losses. This week, mostly the gains were contributed by the banking conglomerates as we saw sheer outperformance throughout the day (similar to last few days). In the broader market too, only selective stocks performed well and hence, one needs to be very fussy going ahead when it comes to the stock selection.

TECHNICALLY SPEAKING.

Although we have been sounding a bit cautious since last week or so, market didn’t look tired at any point; but this week on Thursday for the first day, we witnessed some fatigue in Nifty at higher levels. Technically speaking, we observed a ‘Bearish Wolfe Wave’ on chart and precisely from the Potential Reversal Zone of this pattern, we witnessed some profit booking in the market. Till now, we were only making our assumptions but now we can see a defined level on chart, which can trigger some weakness in Nifty. This level is at 11400. Going ahead, a sustainable move below this point should be considered as an exit opportunity for existing longs and aggressive traders can opt to short as well. Below this, 11300-11200 are the next levels to watch out for. On the upside, 11700-11900 remains to be an immediate hurdle and in case if it extends further, we will still avoid participating in it. Clearly, the market is in a beast mode at present and is in no mood to correct. Since the last few days, we have not been participating actively in index on the long side. Although it has strongly maintained its positive posture, the real momentum is clearly lacking. But yes this cannot be the excuse of letting this move go. There are times in the market, when things do not go as per the expectation and this is exactly the same. But we do not want to get carried away by this, because it's not giving us any comfort and sometimes there is absolutely no harm in avoiding extended moves. For the coming session, 11700-11800 would be seen as immediate upside levels and it coincides with one of the clusters of resistances. On the downside, intraday support is placed at 11500 - 11400 and with reference to previous commentary, if any weakness has to trigger, the Nifty should break and sustain below 11400.