Moving up after correction: Market Analysis : April 5 2021

 

• One of the shortest trading week went by but it made up for it pulling up market above 14850 levels from the dip it  made at previous week low of 14264 which could be a major support ahead.

• Monthly doji pattern indicating uncertainty among participants the whole of march due to various events like  us yields rising, Biden package covid wave2 DII rebalancing etc.

• Monthly momentum in bullish zones itself and trend strength seen rising

• Weekly change in polarity may be working showing a bounce from previous support

• Weekly momentum has taken support and rising in bullish zones but trend continue to be bullish but with strength is downwards

• Weekly positive reverse divergence indicating an up move towards targets of 15430 all time levels again

• Daily momentum is in sideways itself but the downwards moves seems too arrested if u notice the  Bollinger bands although price consolidation is evident. Daily trend is downwards but with less strength.

• 50 day moving average has not yet been conquered decisively as close was below it. 

• Closed above 38 FIB retracement and any close above fib 23 levels would also mean 15000 is reclaimed

• Futures open interest buildup is short covering which means those who placed bets on a reversal of market are  now covering themselves.

• Option open interest showing 16000 for April 8 expiry is deceiving due to hedge positions taken. But 15000 level are seen to be having a large call writing while 14700 can be seen as support level.

• India vix dropped 2.4% last week end at 19.99 which also gives indication that fear in market has gone down a bit last few days at least and could also mean market to move up as long it does not shoot up to 22 levels of previous week

• india vix  based range of nifty movements could be  expected between from 14489- 15245

• FII selling was only on march 31st that was compensated by DII buying.

• Sector wise long build ups were seen in metals and private banks sectors

• Bank nifty also is short covering on open interest on futures while option open interest suggest resistance at 35000 levels and support at 33500 levels. Bank nifty also has the weekly positive divergence and change in polarity indicating an up move to previous high if it manage to close above the 50 dma at near 34000 levels and then 23 FIB level near  36000 levels both seen are major resistance for it on charts in confluence with what levels suggested by OI.

•  As summary my view will turn to bullish for the week the moment closure occur above 15000 even though a monthly basis consolidation continue until breaks above previous all time high of 15400 levels.