RETAIL RESEARCH 10 Feb 2017

HSL Weekly Insight
Week ahead for Nifty with technicals…

Nagaraj Shetti
nagarajs.shetti@hdfcsec.com
Tel-022-30750021

RETAIL RESEARCH P age |1

which is suggesting a pause in upside momentum. previous opening downside gap of 26th Sept 16) has been offering strong resistance for the market in the last couple of sessions. As long as the daily RSI stays above 60 levels. • Nifty is now repeatedly testing the said hurdle in the last few sessions and was not able to surpass that area despite positive opening. • Daily 14 period RSI has turned flat around 72-73 levels. could eventually result in upside breakout of the resistance. • Though. Now one may expect Nifty to move and sustain above 8820 levels to form a new higher top. there is an absence of sharp weakness and in turn we observe formation of long lower shadows. Nifty is finding strong resistance around 8820 levels. Minor dips in the market could lead RSI to dip down to 65 levels. This is suggesting emergence of buying interest from the lower levels. any dips in the market is unlikely to damage the underlying trend of Nifty. Continuation of such sideways consolidations just below this hurdle (8820 levels). • The positive structure movement of higher tops and bottoms is intact as per daily timeframe chart over the last 5-6 weeks and the recent swing low formation of around 8715 levels could now be considered as a new higher bottom of the sequence. • The overhead hurdle of 8820 levels (brown dashed horizontal line. • After showing minor weakness during early part of this week. RETAIL RESEARCH Nifty Daily Timeframe Observation: • Daily Timeframe: Nifty shifted into choppy trend in today’s session and closed the day with minor gains of around 15 points. RETAIL RESEARCH P age |2 . Nifty shifted into sideways range movement in the last couple of sessions and showed lack of strength to sustain above 8820 levels.

Such formations more often results in uptrend continuation patterns. Summing Up: • The short term trend of Nifty is sluggish and the trend as per larger timeframe is still positive. • Weekly 8 period MACD is showing positive crossover signal (MACD line is cutting above its signal line) near the equilibrium line. This is signaling that the strength of upside momentum as per larger timeframe is still intact. Nifty has been in a sharp up trended move over the last few weeks and this pause in upside momentum could also be considered as a temporary halt in upside momentum or consolidation pattern at the higher levels. the formation of top reversal or sharp weakness could be ruled out. • As long as Nifty holds above the immediate support of 8715-8700 levels. but they needs to be confirmed by the way of decent negative closings by subsequent weeks. as per w-o-w basis. • Nifty is now advancing towards the next important overhead resistance of around 8925 levels (orange intermediate down trend line connecting the two important tops). Nifty seems to have struggled to continue with strong upside momentum and closed the week with minor gains of around 53 points. This area is expected to offer strong resistance for the market on any rise from here. a formation of doji patterns after a reasonable upmoves are impending signs of top reversals. RETAIL RESEARCH P age |3 . The maximum upside levels to be watched for next week could be around 8925-50 levels. The presence of immediate resistance and the weekly pattern formations are all suggesting a pause in upside momentum since past one week and could possibly continue for next week. • Since. RETAIL RESEARCH Nifty Weekly Timeframe • Weekly Timeframe: After showing sharp upmove in the last couple of weeks. • Normally. as the week’s opening and closing are not identical) this week at the new swing high of 8822 levels. • A long legged doji type candlestick pattern has been formed (not a classical doji pattern.

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