NIFTY OUTLOOK AND TRADING TIPS FOR FEBRUARY 28 - MARCH 4, 2022

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WEEKLY RESISTANCE FOR NIFTY: 16800, 17000, 17200

PIVOT POINT: 16500

WEEKLY SUPPORT FOR NIFTY:  16300, 16100, 15800

WEEKLY CHART FOR NIFTY

DAILY RESISTANCE FOR NIFTY: 16750, 16825, 16975

PIVOT POINT: 16550

DAILY SUPPORT FOR NIFTY:  16400, 16300, 16200

DAILY CHART FOR NIFTY

The Indian stock market started the week on jitters as it tracked weakness in global stock markets. However, after the initial hiccup, the bulls managed to minimize the damage, leading to a decent mid-session recovery. After the showdown, the Nifty50 Index finally ended the day narrowly in favor of the bears with a doji-like candlestick formation, just above 17200. Our domestic market tumbled in early trading Tuesday amid the global market crackdown. The benchmark index, the Nifty50, tumbled over 2% to break the psychological 17,000 level and has hit a low of 16,843 in the early trades. Gradually the market gained control of the decline and saw some rebound from the bottom to end the day just below 17100. Tuesday's smart recovery was followed by a pleasant start to Wednesday at almost 17200 as indicated by the SGX Nifty. With some minor ups and downs, the index fluctuated in a narrow 100-point range for most of the session. However, towards the end of the session, some jitters were evident in the broader market, cutting any gains in no time. In fact, the leading index, the Nifty, ended up just in the red below 17100. Escalated geopolitical tensions between Russia and Ukraine brought the global stock market crashing on Thursday. Our home market was also not spared from this ongoing crisis and so we experienced complete chaos everywhere. The benchmark index, the Nifty50, is down nearly 5%, likely its biggest single-day drop in many months. On Friday Benchmark indices broke a seven-day losing streak to gain over 2% amid supportive global markets and buying across sectors. To finish, the Sensex was up 1328 points, to 55858 and the Nifty was up 410 points, to 16658. Domestic indices rebounded strongly, following positive leads from global markets and benefited from lower valuations after the massive sell-off in the previous session a breather as the new US sanctions did not target Russia's oil exports nor its access to the Swift global payments network.

NIFTY: A STRONG SUPPORT WILL BE @ 16200; STRONG RESISTANCE LEVEL SEEN @ 17200

Friday we saw a good recovery in the market after yesterday's chaos, Nifty closed up 2.5% with good momentum seen in the small and mid cap space. However, given the weak global cues, the market continues to see volatility. Investors are advised to maintain adequate liquidity to take advantage of a sharp fall in the market and to buy quality stocks on larger falls. For Nifty, 16200 will act as a very strong support level. If this level breaks later in the day, next support is around 16000  levels, after which markets could accept support at 15800 levels. On the upside 16800 will act as a strong hurdle rate, if this level breaks the next resistance will be around 17000 levels after which we might see 17200 levels.

TECHNICALLY SPEAKING

The formation of a bullish ABCD pattern helped Nifty rally as the benchmark index ended 410 points above the previous close. The significant recovery in the markets followed a rally in global equity indices. The recovery rally was expected as markets worldwide including India had been steadily falling for the past seven sessions and therefore a recovery was on the cards. If the war between Russia and Ukraine continues, the upside could be short-lived and market sentiment could turn weak again as bouts of volatility lie ahead. It would be interesting to see if the index holds the 16600 level or not. However, if the index manages to trade above 16600, a pullback formation is likely to continue to 16800-17000. However, a strong possibility of another near-term correction is not ruled out if the index closes below 16,500. Below that, there is a possibility that the Nifty could reach the levels of 16200 to 16000.