Nifty Weekly Outlook (13th to 17th September 2010)

Last Week ending on Friday (09^th September 2010) NIFTY gained almost 2.93% and closed strongly at 5640.05 as compared to the last week’s closing of 5479.40. Continuing the uptrend and also the rising consolidation pattern, NIFTY made a White Opening Marubozu Candlestick on the weekly charts, and gave a breakout above its upper trendline too. As seen on the charts, NIFTY is forming a bullish consolidation pattern, with higher highs and higher lows, which is a Bullish Consolidation Pattern. Since the starting of the week, NIFTY continued its uptrend with a good set of Employment Numbers announced in US, leading all the markets over the globe higher. NIFTY maintained it’s up run, with a good sectoral cycle like CEMENT, METALS, REALTY & INFRA, TEXTILE, BANKING & FINANCIAL and SUGAR. For the week NIFTY made a low of 5479.55 and a new 52-Weeks High or say 31-Months High of 5647.45. NIFTY has moved much above its 40-Days EMA (Exponential Moving Average) of 5174.56 and the 20-Days EMA of 5506.18.

All the major International Indices after facing resistance are now trading near their important support levels, now from these levels a good bounce can be expected, or if the support breaches, a correction can be expected in the near term. For the next week, a good trading momentum will be observed in Sector Specific and other specific stocks, but then too traders should follow a cautious approach by following strict Stop Losses.

On the Global front, in US, Retail-sales and jobless reports top the economic data agenda. In Europe, New global capital-requirement recommendations for banks will be unveiled on Sunday. In Asia, all the major Economic Data have been announced both in China, Japan and India, the impact of which will we witnessed on Monday itself. 

With the ongoing uncertain global environment and results season, traders are suggested to trade cautiously by following Strict Stop Losses and avoid making fresh investments at this point of time.

For the next week, the level of 5676 / 5700 / 5730 will act as an important resistance, whereas the level of 5525 / 5490 / 5470 will act as an important support for NIFTY.