Choppy till trend emerges : Nifty Weekly Analysis : April 19 2021

 

• Another week with yet another indecisive doji candlestick pattern forming yet another new positive reverse divergence on momentum while previous one didn't worked out though it attempted and moved above previous week high.
• Last week nifty once again took support near 14250 levels and bounced up for 3 days.

• A window gap resistance in the 14650-14790 levels along with a 50 day moving average hurdle at 14860 levels indicate that a bullish call can be taken only after a close above this.

• Same time the previous swing low levels around 14250 seems to be acting as a good support for now in confluence with FIB 61 retracement also at same levels.

• 14000 could act as interim support and 13600 levels could be downside levels if the above support is broken and beyond that it cease to be consolidation and prolonged bearishness could come in.

• momentum is still intact weekly and monthly timeframes while daily is continues to be sideways once gain reminding this is consolidation in market. Reading along with change in polarity and bounce up on weekly still does not allow to call bearishness in market. ADX trend is bearish but not with great strength like bank nifty.

• open interest in nifty futures shows long buildup. Options data is bearish overall which shows highest call writing seen at 15000 while support is seen at 14000.

• Bank nifty dipped with a gap down last Monday nearby 2000 points and later 3 days recovered most of it but the gap is yet to be conquered by few points. But now momentum on daily thereby has made a range shift from bearish to sideways.

• Bank nifty is far away from 50 day moving average of 34700.Only a close above 33000 in confluence with FIB 61% and open interest levels would make bank nifty into bullish zones. Retest of below levels and taking previous major January swing low support at 29700 cannot be ruled out if it cannot sustain the bounce back move. However keep in mind that the Weekly and monthly momentum are not longer in bullish zones unlike nifty. ADX trend indicator are seen rising up in strength on bearish side.

• open interest in bank nifty futures shows long unwinding meaning both price and open interest is falling. options data is bearish overall with major resistance seen at 33000 and support at 31000

• FIIs are  not selling big is a relief which again could mean this could be consolidation.

• India VIX last week shot up 16% on Monday when lockdown fears came in  while later it cooled down 11% next day and  finally closed at 20.4 levels on Friday. Volatility could continue to there coming weeks as fear resides very much in the market very much. daily movements of indexes are very high and markets could remain choppy before a trend emerges from it eventually.

• Charts saying nifty is consolidating and bank nifty relatively weak but attempted to join nifty in the sideways movements , but the prevailing sentiments uncertainty could make it tough to trade in the choppiness. Non directional options strategies with a good range can be applied. Plain longs may not be wise unless a confirmation of it comes in. A blind shorting also wont work for swing trades as market are not ready to make a trending fall. However Intraday Weekly options Calls at 15000 and 33000 levels can be sold with strict stop loss if big trending moves are not seen.