2022-07-01 07:25:00

Daily Technical View


Nifty:- Bull’s Tower Top!

Nifty as expected closed in perfect fashion. On YTD basis flat and in dollar terms negative. This very simple inference can comfort many hopeful bulls. What the internals story is still a worry factor. Bull`s hit the Tower Top Pattern, which is very powerful in Quarterly frames. This clearly suggests the direction is headed south and would remain lower and longer. The forces that aided the up move are no longer with the bulls. Contextually maximum annual draw down was in 2008 (a more panic which is absent now), an orderly one was 1995 and 2011 both printing 24% (approximated) on close basis. We are just 9% down. This is not a forecast though. Suffice to see more loose bricks to fall than a base building, only optical illusion keeps bulls hopes. For the day sell stops 15940 (slightly longer than a day and as always suggest appropriate hedging on week ends at least). A close below 15600 suggestive of next leg down completing the ominous bear flag.  There are no clear signs of bulls and the one that came in their way failed leaving the over sold zones back to healthy ones.

NIFTY BANK:-  ARK comes full Circle 
ARK - Investment is very famous and popular destination. Cathie Wood is popular among the investors though like most other bulls running tough times. They have recently limited their focus to select sectors. They also have acknowledged economy is in deed in recession. While many conclude recession, FED continues to favour a softer landing though a tough one. This clearly suggests going forward movements in US may not mimic else where. The tremors will be felt more else where than in US. Consensus still towards recession, that appears more on hope of rate hike pause expectation than any other objective for the market price action. Ultimately, it would reflect in Corporate profits, economy and in turn into the bank`s balance sheet. Coming to the Bank Nifty, it continues to dither and there is a complete arc in this picture. The big needle is 30500 if that goes all goes. It is more a range of 30500-32000. For the day remain short stops 34300 (slightly bigger) and await for 32000 test.