Nifty close 10526.75: The benchmark index closes this week on a negative note. Closes by making three consecutive red candles. In technical analysis this three candle stick pattern is also known as Three black crows pattern and this pattern suggest negative sentiment may take place in the market.
There are few global factors and domestic factor which influenced this sharp fall. Global growth is slowing down, high crude import, FII selling and trade war between USA and china were the key reason.
At this moment, Nifty is standing at its important level which is 10500mark. This level is important because it is a psychological as well as a technical support level. Above this level there is 10650 mark which is a resistance for the index and 10500 mark is the latest support. Below this Nifty will find another support which is at 10350 mark.
Hourly Technical: If we look at the hourly chart it is a recently formed downtrend and because of this trend price has breached 100 MA line. At this moment most of the MA lines are above the price level except the 200 MA line (presently ay approx.. 10443), so this line would act as an important support in case further down fall takes place and if the market trade higher 10650 mark will act as a strong resistance.
Let’s discuss the technical aspect, RSI is just above the 30mark, Stochastic is at its oversold level (approx.. 10), ADX is at 17 level (approx..) and CCI is below -150 level.
So overall the sentiment is bearish and strength of this trend is strengthening which is showcased by the ADX indicator. Another important factor is that there is positive divergence in the RSI indicator which may push the market little higher.
Daily Technical: In the daily chart of Nifty it is consecutive three red candles. And if we take the previous swing high, it is nearly the 250 points correction. This three red candlestick pattern is also known as three black rows and it they refer bearish sentiment.
Let’s focus on the indicators, RSI is just below 50, Stochastic is at 25 mark (approx..), ADX is below 20 and the CCI is at 34 level.
So as the indicator suggest, Sentiment in the bearish side but there may be a halt because of the recent support which is at (10500 level). And if the index pulls back from this level 10650 level may act as a resistance.
Weekly Technical: It is a bearish engulfing pattern in the weekly chart of Nifty. So it is a negative sign for the market. If we look closely we would see that the index has pulled back from 13 MA (presently at approx. 10794.46) line in the weekly chart. At this level there is also presence of 50 MA line (approx..10729). So they both acted as a strong resistance.
In the weekly chart support may come from 10350 mark and if the index breaches this level 100MA line (presently at approx.. 10124.81) will be the major support for the index.
Let’s discuss the indicator, RSI is just below 45 level, Stochastic is just below 30, ADX is above 20 and the CCI is -59 level (approx..).
Most of the indicators are flat at this moment but as we know candlestick sign are very important to understand the market sentiment. So for now market is in the Bear’s territory as per the Candlestick signal.
You can use stockedge app to get cutting edge over others in both short term trading and investing. Here you not only get data at one particular place but can also create your own combination scans based on your own technical and fundamental parameter. See the video below to know about various features in Stockedge app.