Nifty Analysis Week ended 24 May 2019

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Hello Friends,

The week was volatile for Indian Markets as important election outcome was scheduled during the week. Weekly Options expiry was also on the same day that is 23rd May, 2019.

In response to Exit poll, the week started on very strong note with a gap-up opening (11651) on Monday & remained range bound to prepare for the elections results day. Daily chart was giving bearish signals.

on 23rd It touched High of 12041 and shaded all gains due to profit booking to closed around same levels (11657) where the week had started on Monday.

Weekly Chart Analysis:


There is a bullish Weekly candle on chart but with a long wick on it's top. The closing is life time high for this week.
However, RSI one of the important indicator is still showing divergence on weekly scale.
This is showing weakness in up-move and more profit booking may take place.


Daily Chart Analysis:

On the daily chart, Nifty movement has been range bound between 11590 and 11850.
Moves above 11850 have faced selling pressure.
RSI continues to show divergence indicating weakness in up-moves.

Options Chain Analysis:

  • Options data shows increased Open Interest at 11700 level with addition of 10 lakh contracts.
  • 11700 will act as support level for this expiry.
  • On the upside, 12000 & 12200 will act as resistance levels with high open interest.
  • 12500 has highest Open interest on the upside.


Conclusion:

  • Overall technical set up is bearish.
  • If the week's low of 11590 is broken, the we may see further selling pressure.
  • As per option data, more upside may be seen if 12000 levels are taken out.
  • Volatility has come down. Further cooling off in India VIX will attract bulls back in action.



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Disclaimer: I am not SEBI Registered analyst. All above analysis are just for study purpose.
I am not responsible for any gain or loss arising out of trades taken based on the study shared above.
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Location: India

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