Nifty Updates for Next week - 20th to 27th May 2022
Nifty 50 Index crashed sharply on Thursday and lost over 2.6%, on the back of weak global cues. This was a sentiment-based fall led by the meltdown in the US markets, on the fear of aggressive rate hikes. Heavy selling was in the index majors across sectors wherein IT and metal majors were among the top losers. The index has once again completely reversed the recent gains and closed near March lows, forming a strong base around 15,650 levels (‘Triple Bottom’). On can look at the declining market as descending steps with the base of the step acting as a support, and we are currently at once such a strong base.
The index has been in a downtrend since April (making Lower Lows and highs) but has stopped making a new low (getting rejected 3 times). On a 2-week close to close basis Index has made violent moves both ways but is flat, indicating the indecision in the markets and giving an essential range to watch out for 16,350 – 15,650. A breakdown of the current support base will activate the ‘ABCD’ pattern and can take the index to 15,000 levels. Short-term trend-reversal is possible only if the immediate resistance at 16,350 is broken and sustained, which in turn will activate the ’XABCD’ pattern and can fuel a small rally towards 16,650-700 levels.
The index has been in a downtrend since April (making Lower Lows and highs) but has stopped making a new low (getting rejected 3 times). On a 2-week close to close basis Index has made violent moves both ways but is flat, indicating the indecision in the markets and giving an essential range to watch out for 16,350 – 15,650. A breakdown of the current support base will activate the ‘ABCD’ pattern and can take the index to 15,000 levels. Short-term trend-reversal is possible only if the immediate resistance at 16,350 is broken and sustained, which in turn will activate the ’XABCD’ pattern and can fuel a small rally towards 16,650-700 levels.
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