NIFTY FUTURE WEEKLY / BANK NIFTY FUTURE WEEKLY
NIFTY FUTURE :
Last week, saw a sharp rise from the bottom of 5310 to a high of 5612 - a range of 302 points. While the rise has been sharp, when seen in perspective with the previous weeks, it has been a sideways move. Interestingly, we had a similar phase of sideways movement in Dec/Jan for 7 weeks and thereafter it fell down to the current range of 5200 - 5600. (Please see the chart with lines marked in Blue).
When compared with the previous phase, we must also remember, that this time we are out of the channel (shown in Yellow), which itself indicates weakness. We have already completed 5 weeks of sideways movement.
The pattern referred on the charts is an inverted Flag in both the situations. While last time the pattern target was achieved, this time the pattern target is around 4200. This also coincides with Right Shoulder target of 4400 which is being mentioned in my post for many weeks now. The breakout on the lower side is at 5230 which also coincides with the trend line, which provided support at 5175.
The Oscillators on the weekly chart continue to suggest weakness.
BANK NIFTY FUTURE:
There is a similar sideways movement on the Bank Nifty Future as shown on the attached chart. The breakout on the down side will be at 10000 which provided support last time. The next support is at 9000.
One may wonder what could precipitate the fall. The main reason could be the Oil price hike which could lead to further worries on inflation. Besides of course the many issues like Corruptions/Scams etc. which keep coming up with regularity in a large democracy like ours.
The purpose of this post is not to alarm and possibly spoil your weekend, but to help you plan your strategy to benefit from the fall - either by going short at the appropriate levels or at least by selling your stocks so that you can buy at lower levels, if and when the fall happens.
Hope this post will help you to ponder, discuss and decide your strategy over the weekend.
Have a nice weekend!
Ketan Asher.
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