NIFTY-Weekly Outlook-Venkat's Blog

11 Nov 2023

The market sentiments improved and a pullback rally is under progress. There is an element of disbelief which resulted in a smaller gain during the week. However, the weekly closing at near high is seen as positive. Risk perceptions keep altering market is confused with FEDs narratives and the economic data releases. Remains to be seen whether this is a fresh trend emerging. For now, we can safely assume that the base has shifted higher to 19250. Though there are multiple hurdles for the Index to overcome.

A few observations from the weekly charts are:

• The index moved in a narrow range of 155 points viz. between 19309 and 19464
  
• The oscillators of different time frames are showing mixed signals
  
• Option open interest to drive the direction of the market
  

 
Expected scenarios for the ensuing week

• Index attempting a pullback rally. However, there are multiple hurdles ahead of the path
  
• The re-attempt of 20K would be a herculean task, given the change in risk scenarios
  
• Additional interesting observations
  
• Bears might be waiting on the sidelines waiting for signals to re-enter
  
• Index may find supports at 19320, 19210, 1913 and the index could face resistances at multiple levels 19530, 19640 &19770
  
• Though the earlier gaps got covered during the down move, and new gaps have been created around the same levels.
  
• 18818-18908 (28th Jun 23) Covered
  
• 18972-19079 (29th July 23) Covered ** Created again as 18990-19129
  
• 19189-19246 (3rd July 23) Covered ** Created again as 19144-19247
  

Final Note

• The Index has stayed well above the long-term trend line and the 200 DMA at 18677 and trying to catch up the 55 DMA at 19540
  
• As expected the Ascending channel support line broken earlier during third week of Oct 23 could be a major resistance at 19560. Incidentally, this is close to 55 DMA
  
• With sentiments improving, there are possibilities of attempting the 55 DMA and an attempt to surpass at least for a brief period if the momentum favors. The reason for this observation is that the Fib projections as per daily chart suggest a target of 19610
  
• The distinct fault lines lie at 19250 on the lower end and 19530 on the higher end
  
• On a contrarian view, if the index crosses 19600 on a closing basis, what next? Can we conclude that a new wave starts for a new ATH or at least 19850(from where the downfall started)
  
• If the Index survives above 19530 during this week on a closing basis, there are fair chances of the Index attempting 19840 during next week
  
• The good results posted by top companies have not helped much so far might have impact during the ensuing week
  
• We need to see multiple closing above 19500 to see further gains
  
• A truncated week might chage some of the outlook overnight and hence need to exercise cation.
  

#Stay Safe

Disclaimer: The views expressed here are personal and not connected to SYFX Treasury Foundation. The views are for learning and reference purpose only.