WHY NIFTY GOING UP? AGAIN A GAP DOWN ON MON (15 Oct)POSSIBLE?
Actualizado
THIS IS THE THIRD PART OF THE ANALYSIS ON NIFTY 2.32% FALL. IF YOU NOT READ THE PREVIOUS ONE 2 POSTS, PLEASE READ THE SAME FOR BETTER UNDERSTANDING. I HAVE ALSO SHARED ITS LINK BELOW.
Last time we estimated a big downfall in the month of October and believed that IT Sector might stay in pressure as the results of Tata Elxsi disappointed and Number of TCS may also disappoint.
Although, There was no downfall today. the top companies of IT Sector behaved in the manner as expected. TCS, Mindtree, NIIT and HCL Tech ended on the negative note and other companies fell initially but recovered and ended with minor gains.
However one major thing to see is all the major global markets including Nikkei, Dow Jones, other Index were in Dark Red and even SGX NIfty was in -200 (although I do not believe SGX Nifty is directly related to Nifty but being part of the global market, even it depicts the sentiment of the market). Our Nifty did not showed any Red Colour.
FII Data suggest that they have net purchased 7.9K Index Futures and 10.2K stock Futures.
Important Event.
1. Consumer inflation stood at 3.77 per cent as against 3.69 per cent in the previous month. This rise in inflation was driven by higher prices of food and fuel along with weakness in the rupee. The retail inflation figure was lower than economists' estimates of 4% and was within the comfort zone of RBI. (Good for Market).
2. Good result of Nifty 50 Company - HUL.
3. Lined up result of Nifty 50 Company in coming week- Infy, Reliance, HeroMotoCorp, HDFC Bank
Candles Formation
The last 3 day candles have created a Bullish reversal pattern in the form of Morning Star.
Interpretation
With a rise of Today, FII has also added Longs in Shares and Indexes. We can expect a small pullback rally over here. HUL has result has been great, which will have a positive impact on the market after poor numbers from TCS. In The coming week result of top Nifty 50 companies are there, which will shape the market.
In the process to up,There has been 2 Gaps created in the past downfall and crossed 2 Fibo support (Mentioned Below) which will stop the market from going up.
Resistance 1 - Gap 1 - 10520-10550
Resistance 2 - Fibo Resistance 38.2 - 10650
Resistance 3 - Gap 2 - 10750-10850
Resistance 4 - Fibo Resistance 0.5 - 10860
The Above 4 levels are going to act as major resistance. Even after being optimistic, I do not feel market will be able to cross Resistance 3.
Please note Pullback are short term and short lived. Thus, I personally do not prefer trading the pullbacks. However these pullbacks gives good level to again short the market.
Please also note : FII even after covering have 89K Shorts. The fall can be deffer-ed but is certain to come until FII decide to cut their shorts in losses. (which never happen :P)
The last time Nifty/Bank Nifty rose 300/800 points, it witnessed a bigger Gap Down the next day. I do not expect the same on Monday. Market might open Flat.
These are just my thoughts, and my view to the things going around. I hope it Helps.
All counter views welcomed if they intend a fruitful discussion. And If Warren Buffet says he still learns, who are we to say or believe that we know all. Lets learn together and Earn together.
Thanks.
Last time we estimated a big downfall in the month of October and believed that IT Sector might stay in pressure as the results of Tata Elxsi disappointed and Number of TCS may also disappoint.
Although, There was no downfall today. the top companies of IT Sector behaved in the manner as expected. TCS, Mindtree, NIIT and HCL Tech ended on the negative note and other companies fell initially but recovered and ended with minor gains.
However one major thing to see is all the major global markets including Nikkei, Dow Jones, other Index were in Dark Red and even SGX NIfty was in -200 (although I do not believe SGX Nifty is directly related to Nifty but being part of the global market, even it depicts the sentiment of the market). Our Nifty did not showed any Red Colour.
FII Data suggest that they have net purchased 7.9K Index Futures and 10.2K stock Futures.
Important Event.
1. Consumer inflation stood at 3.77 per cent as against 3.69 per cent in the previous month. This rise in inflation was driven by higher prices of food and fuel along with weakness in the rupee. The retail inflation figure was lower than economists' estimates of 4% and was within the comfort zone of RBI. (Good for Market).
2. Good result of Nifty 50 Company - HUL.
3. Lined up result of Nifty 50 Company in coming week- Infy, Reliance, HeroMotoCorp, HDFC Bank
Candles Formation
The last 3 day candles have created a Bullish reversal pattern in the form of Morning Star.
Interpretation
With a rise of Today, FII has also added Longs in Shares and Indexes. We can expect a small pullback rally over here. HUL has result has been great, which will have a positive impact on the market after poor numbers from TCS. In The coming week result of top Nifty 50 companies are there, which will shape the market.
In the process to up,There has been 2 Gaps created in the past downfall and crossed 2 Fibo support (Mentioned Below) which will stop the market from going up.
Resistance 1 - Gap 1 - 10520-10550
Resistance 2 - Fibo Resistance 38.2 - 10650
Resistance 3 - Gap 2 - 10750-10850
Resistance 4 - Fibo Resistance 0.5 - 10860
The Above 4 levels are going to act as major resistance. Even after being optimistic, I do not feel market will be able to cross Resistance 3.
Please note Pullback are short term and short lived. Thus, I personally do not prefer trading the pullbacks. However these pullbacks gives good level to again short the market.
Please also note : FII even after covering have 89K Shorts. The fall can be deffer-ed but is certain to come until FII decide to cut their shorts in losses. (which never happen :P)
The last time Nifty/Bank Nifty rose 300/800 points, it witnessed a bigger Gap Down the next day. I do not expect the same on Monday. Market might open Flat.
These are just my thoughts, and my view to the things going around. I hope it Helps.
All counter views welcomed if they intend a fruitful discussion. And If Warren Buffet says he still learns, who are we to say or believe that we know all. Lets learn together and Earn together.
Thanks.
Nota
Note : Before anyone points out let me share. Morning Star has 3 Stages in which 1st Stage is Big Red Candle however in Nifty there was no big red candle. But since I believe Chart Patterns tell us more about the sentiment and is more of an art than science. We can have different interpretations to that.Technically someone can call it ISLAND REVERSAL Pattern as well.
Nota
FII again adding shorts and closing longs. Hard day for bulls coming!Nota
2 Days they were baiting the Bulls. Infact 2 Day Positive + Gap Up today.All washed off in 3 Hours Fall!
Hope I was able to help you guys. :)
Nota
Lines from the description "The Above 4 levels are going to act as major resistance. Even after being optimistic, I do not feel market will be able to cross Resistance 3."
Nifty Preached and Didnt Breached. :)
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