Nifty - Week end Analysis with Aar vee & Piyush Sharda..

My Observations:
In view of +ve divergences appearing in many stocks and some indices, a bounce is expected. Earlier 5110-5160 has acted as strong support and the same may be attempted.
A "Pause" in the fall, "profit booking by Bears" for few days.

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AAR VEE's ANALYSIS:

LAST WEEK FOLLOWUP

1.“TOPI” target ,as mentioned in last Weekend Analysis achieved.

2. Nifty took support near the Weekly and Daily Channel Bottom and 78.6% retrace levels of the 4675-5399 upmove.(see last Weekend charts)

3. Firm Downtrend continues with the closing price of 4931 below all Monthly,Weekly and Daily Close 5EMA.

SHORT TERM

1.Nifty in firm Downtrend below even 3dema (4952) and that being bearishly aligned with 7dema (5007),moving in a channel pattern.

2.The Basic Indicators, Stochs(5,3), Rsi (9), MACD in Daily charts are in Oversold positions with no apparent signs of a reversal. The Indicators in Weekly charts, Stochs(5,3), yet to exhaust in Oversold region , Rsi (14), below 50 at lowest levels in one Year and MACD in sell mode ,indicate further downside.

3.The Tech Table shows that rallies to Daily 5dema at 4982 and Weekly Low ema at 5017 may get sold into. Bullishness to come only on close above Daily high ema of 5020.Major resistance is at Monthly close ema of 5047. Important level of 200dma is at 4995 .5D Volume Profile chart shows a resistance at 5000-5010 levels.

So ,next week,the Resistance zone will be 4985-5020.

Supports are at Monthly Low ema of 4873, 2D low at 4844, Weekly Pivot S1 at 4814 and Channel Bottom Trendlines near 4800 zone .

So ,next week, the Support zone will be 4800-4850.

Now , till there is a close above 5050 ,the Mantra should be Sell on Rallies rather than Buy on Dips.

MISC. OBSERVATIONS AND CAUTION

1.The Nifty Futures Open Interest of May series is at the highest level (2.967 Cr.), of the total series.The Daily Volume Profile and long tails of the Candles in Daily charts indicate that there has been buying at lower levels during last week.

The Next Week being the Series Rollover and Expiry one , if the markets start trading below 4850 levels ,the overall Bearish TA along with high open interest can bring panic closing of the longs in the system and even break 4800 levels to trade below it with target of 4760(ABC pattern),&4725(23.6% retrace of total upmove from March 09 to April 10).

2.Caution should be taken against forming Positional Longs or even carrying BTST Longs till the TA shows firm reversal by the prices closing above Daily Ema ,Positive diversion in Indicators and Bullish aligning of Moving Averages.Refrain from taking long positions based on any Indicator till the Price indicates in the Tech Table to do so. Now till there is a firm reversal ,remain with the Trend and enjoy the slide.

Make ‘Hay’ while the things are going ‘Hay’wire

LONG TERM CHART

The 2 Year Nifty chart shows that on last trading day the 5Dema crossed 200Dma Bearishly ,(from above) .This is happening for the first time after March 2008. Is it the sign of paradigm shift in Market Structure?

Is it the first sign for the “End of The Days” ?.

Regards,

AAR VEE

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I am posting another analysis done by Piyush Sharda:

WEEK: Nifty closes below weekly channel, however another channel with bottom at 4800 is yet to be broken.

Weekly trend wud change on close above 5082 and downtrend pauses at 5017 (week low ema). Weekly 5d has reached o/s but 15 d is 43, 5d yet to turn up. Nifty yet to close below 50 wma.

DAY: Nifty 5 day ma crossed below 200 dma, 5 and 10 dma crossed 50 dma 20 yet to cross. Nifty crossed day lema(4931) .targetting 4982- day ema and day hema 5020. Channel break at 5080 can cause breakout, 5105 is last swing high. Positive divergence in fast macd , stoch and rsi. Day formed a bullish reversal ( bullish counterattack line) Extremely o/s with 5d at 17 and 14 d at 12.

HOUR: Hourly trend has completely turned up with hour closing above hour hema, wedge broken with positive divergence.

OPEN INTEREST: Nifty future oi increasing says that shortcovering yet to happen. ( Bad news for shorts). 4800 put oi increased by 14 % it will be floor looks like 5000 call oi decreased 8%, it may not be the ceiling.

BEARISH: The main bearish factors are trade below moving average.

BULLISH: Bullish factors are

1) Bullish counterattack line in daily

2) Positive divergence in daily and price close above lema

3) Breaking wedge with positive divergenvce in hourly

4) Oi increasing with prices moving up ( short covering not happened yet)

5) Options mildly bullish.

LOOKS LIKE BULLISH REVERSAL FOR FEW DAYS, MAY TAKE OUT STOPS BEFORE FALLING AGAIN.