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Nifty Daily

21 Jul 2020 ‚óŹ 02:13 PM





Position Sizing model - Long % = percentage of indicators bullish v/s Short % = number of indicators bearish, Including both daily and weekly time frames.

 TIME TREND Up Level   Down Level
 Short term trend  Up  11320 10919

The Bollinger bands are starting to expand again, a sign of trend continuation that has managed to push the daily momentum back into buy mode. As mentioned before when the momentum whipsaws you may trail with the 20 DMA which is now at 10,644. The 20 hour averages at 11,004 as the intraday support. The point marked as Max is where wave v of 3 will be equal to wave iii of 3. In other words if the current rally goes beyond 12,060 we will violate the rule that the 3rd wave cannot be the shortest, and that will mean a change in the wave count to a more aggressive posture. In the current scenario we should expect wave 3 to complete somewhere before the 12,000 Mark. 11,400 being the 78.6% retracement remains the idea level to watch out for this possibility.


On the trendlines the immediate support from the steep channel is that 11,141 and the previous swing low at 10,953. The top end of this channel is likely to stretch towards 11,320. The broader channel for the 3rd wave has its lower end near 10,800 and its top end goes towards 11,500. On the way prices will face resistance from the next gap area above 11,433.


Some people are asking me if we are overbought. Not on the swing yet, as we are reading 69 today and overbought would be at least above 80 if not above 90.


  BANK NIFTY        
 TIME TREND  Up Level   Down Level
 Short term trend  Up  23080-24201  21962

Bank nifty is now close to the upper Bollinger band at 22,961 and the previous higher 23,080. Once these levels are surpassed we should be heading towards the 26,000 Mark. Near-term volatility in banking stocks due to results can generate a pullback in bank nifty. If that happens then the 20 DMA at 21,960 to should be the key support. The daily momentum has crossed back to the buy side confirming the start of a new momentum cycle for wave 3.


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