The Economic Times, Nov 15, 2016
The underlying trend of the Nifty is weak and any pullback rally could find strong resistance around 85008550. Any crossover above 8700 could be seen as a sign of reversal and will indicate strength coming back.
Sectorally, midcap, smallcap, automobile, pharma, PSU banking, realty and energy sectors are expected to underperform in line with the broader market.
NAGARAJ SHETTI, TECHNICAL RESEARCH ANALYST, HDFC SECURITIES
What is in store?
The Nifty witnessed sharp weakness last week and showed decisive downside breakout of the key lower level support of around 8500 levels.The overall chart set up as per daily timeframe is indicating a downside breakout of `descending triangle’ type of pattern which is a significant reversal. This could open up the downside pattern target for Nifty of around 8035 levels. This could be achieved in the next 3-5 weeks.
What could investors do?
The underlying trend of the Nifty as per smaller and larger timeframe is weak and any pullback rally could find strong resistance around 8500 8550. The downside target of the Nifty for this week is around 8280-8250 and the ultimate target of this down-swing move could be around 80508030. Sectorally, mid-cap, small-cap, automobile, pharma, PSU banking, realty and energy sectors are expected to underperform in line with the broader market.
ASHISH CHATURMOHTA, HEAD OF DERIVATIVES & TECHNICALS, SANCTUM WEALTH
Short-term trend has turned negative for the Nifty though in between support is seen at 8150 levels.
On the derivatives front, the Nifty Future had witnessed unwinding of long positions. But in the last trading session there was 1.82% increase in open interest indicating buildup of short positions.Also, Nifty Put options saw highest open interest shifting from 8400 strike to 8200 suggesting market participants expect lower levels.
Going forward, if the Nifty sustains below 8500 levels, then the market is likely to test 8150 initially and then 8050 levels on the downside.On the upside, any pullback is likely to be capped between 8600 and 8650. However, any crossover above 8700 could be seen as sign of reversal and will indicate strength coming back in the market.Stocks which are in negative trend are Sun Pharma, Larsen and Toubro, Yes Bank; whereas stocks which are showing strength are Colgate Palmolive, ITC, M&M and Sun TV
ASHU BAGRI, AVP-TECHNICAL RESEARCH
Nifty futures is showing a price-gap support between the high of 8415 and low of 8422.35; a weekly close below the gap level of 8415 could lead to further continuation of the current downtrend. Till the time the price gap is not filled, it will act strong support for a bounceback.A close below the downward sloping support channel line could lead to continuation of the downtrend and a close above upper resistance channel line could lead to a reversal.
The week ahead:
Nifty Futures may find support around 8160 and 8390 on the downside The Index futures may find resistance around 8587 and 8723 on the upside The Nifty futures has closed at the lower level of the weekly charts showing weakness for the coming week. It hit a high of 8888 during the week. The volumes were more or less equal as compared to previous week showing indecision for the next week. The futures has closed below 8587. If it remains below 8587, then immediately on the downside it will find support at 8390. A close above 8587 can take the Nifty to higher level of 8723. Buying at Lower levels is advisable in the band mentioned below. We assume a sideways trading session for the next week. Broader trading range for the week to come: 8160 8723 Immediate probable trading range for the next week ahead: 8390 8587