Friday, 28 August 2015

Nifty and Bank Nifty's Surge!

Bottom Line: We are in last leg of the first correction of our multi month Bull Run. We will not enter Bear trajectory until Nifty breaches and close below 6580 for three consecutive days.

Good Morning!

A positive move yesterday and possibly today do not change our outlook in Nifty. If you think I am a bear, you are wrong. I am not a bull nor a bear, and keep changing roles as per the market trend. I believe staying one sided in market won’t lead you anywhere. Today is the start of a new series and we are also going to start our Bank Nifty analysis from today. We will also introduce stocks from Monday.


First thing first. Let’s look at Nifty’s chart and understand what it holds. Nifty has broken down with a gap down, unless Nifty manages to close above the start of the gap down i.e. close above 8360, we will hold on to our intermediate view as negative on Nifty. The volumes data for yesterdays could mislead as it was expiry. It would be interesting to know how Nifty and volume data reacts to start of new series. The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 6580 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Not trending.

Short term Trend: Trending Down. The trend will not change until we close above 8240, which means 8240 would act as SL for those who are short in Nifty.

Take away: Short term trend in Nifty still points downside, and hence we are sticking with the negative view on Nifty. Have a close watch on 8115 as the close above this in today’s trade could (not necessarily) change the short term view from negative to neutral.

Bank Nifty: Likewise in Nifty, Bank Nifty too is in a correction and we haven’t changed our long term outlook to bearish. Bank Nifty is moving towards 15450 on the downside.


The trends for the day.

Long term Trend: Correction to the ongoing Bull Run. As long as we hold on to 13800 we will not turn negative on the long term view of Bull that we hold.

Intermediate term Trend: Not trending.

Short term Trend: Trending Down. The short term trend in Bank Nifty is stronger than the broader index Nifty. As long as Bank Nifty trades below 18220, we will not change our short term negative outlook.

Safe Investing!

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