Nifty breaks out of range - What next?

Last week we had mentioned about a range between 8970 and 9270. The Nifty was trading in this range. We had also mentioned that Nifty has to break out of this range on either side to get a clear direction. Nifty broke upper level of the range on 25th Apr. We can safely assume that Nifty is on its way to continue its journey Northwards, unless some bad news comes in.

What next?

Broadly Nifty is in bull run and is expected to continue with it. Every correction is a buying opportunity in Nifty. After breaking out of 9270, Nifty has corrected a bit to test the level again. We can assume Nifty to bounce again from this level.
If Nifty breaks below 9270, the next immediate support is near 9220.
Both these support levels are buying opportunities in Nifty.

Nifty View for the week 24th Apr

Since last 2 weeks we have been saying that the Nifty is currently trading in a range (With negative bias). Lower end of the range is around 8990. On Friday Nifty managed to close above this level.
Higher end of this range is around 9270. Nifty need to break either of these level to give us a clear direction.

Since Nifty is trading near a small support within this range, which is near 9110, lets understand how one can trade Nifty now. My view is that if Nifty breaks below this level convincingly it can move further below till its next major support near 8990. This is lower end of the channel.

As Nifty is currently trading near a support, short term traders can look to buy Nifty for a bounce of 50-75 points from current level.

Broadly speaking neither bulls nor the bears are in charge of the markets. It seems like some time will be spent in the range mentioned above.

Nifty View - Markets may continue to consolidate

Last week we had hinted at possible correction in Nifty. Important levels given last week were 9160 and 9133. You can see from Nifty chart, that Nifty tried to move up a bit from support at 9160. The level finally broken. Currently Nifty is trading near our next support 9133. This support is a range from 9133-9110. I feel Nifty has good support at this level. Holding this level is important for bulls. Lets hope that some demand will be created at this level and help markets pull up.

If Nifty breaks below 9110 it may undergo substantial correction of another 75-100 points

Nifty View - Wait for further long

Nifty View for the week starting 10 Apr 17-

On Friday Nifty fell by 63 points to close near 9197. This is one of the biggest fall in one day in recent past. 

We know that markets can not run one way. At upper levels you will experience profit booking. This profit booking will make markets move down. 

One such profit booking (Long Unwinding) is seen in Nifty at higher levels on Friday. I have explained this with the help of 60 min chart below. On 60 min chart you can see that Nifty broke below a good support near 9220. This can be start of down trend on 60 mins chart. There are 2 important supports near 9160 and 9133 apart from the current level at 9190. 

On a lager (Weekly) time frame a inverted hammer candle at the top is just an indication of Bulls Exhaustion. This is just indicating that the markets can remain in a range or see some selling pressure unless it breaks above 9273. Every dip in price will be buying opportunity, as the long term trend is very much up.

Breakout in Daawat (LT Foods)

A consolidation breakout in Daawat (LT Foods) is seen on daily chart. You can see that this breakout has come with good volumes. In the process it has formed a pattern called Flag Pattern. The target of Flag pattern is usually large.

Expect 100% returns in Donear

After RAMKY (I had written a small post on RAMKY few days back) Donear is another stock which is forming a nice Rounding Bottom pattern on monthly chart. If the stock breaks and sustains above 78, it has potential to move up to much higher levels. the next resistance is near 160. 

This is might take few months- still worth doubling your money, say in a years time.

Nifty View for the week starting 3 Apr

Nifty view:

Financial year 16-17 is behind us. The day on 31st March was a month, week and day end for markets. Hence in this article lets understand broader (medium term) and closer (short term) view of Nifty.

Medium term:

You can see below monthly chart of Nifty. On monthly chart Nifty has formed a long upward sloping channel. On the close of March-2017 month Nifty has closed at its all time high breaking earlier resistance. We can expect this bull run to continue for next few months. Of-course there will be small corrections during this journey. If we are to believe above theory then Nifty can reach to its next resistance near upper sloping line. The target for this run comes near 10,200- 10,400.

Short Term:

On weekly chart a similar picture emerges. On each correction Nifty is a buy for higher targets.

On a very short scale Nifty has immediate support near 9110 and resistance near 9210. Rather Nifty is trading in this (9110-9210) range of 100 points. A breakout or breakdown beyond this level will make further picture clear.