Nifty - 17500 or 17800 or 18000. Which will come first?

As we stated in our previous week's technical journal the market can go for a retracement, before moving up. And it did the same, continue decreasing India VIX and the FII's relentless selling is the main reason behind it.

The Nifty 50 Index moved in the range of 309 points only, and this trading range remained in line with expectations.

After consolidating the major part of the week and coming off from its high point, the benchmark index NIifty ended with a net loss of 203.95 points, which is approximately -1.14% negative on a weekly basis.

Let us discuss, what Techincal Charts are indicating for next week's market behavior.

Nifty 50 Index Monthly Chart

The Nifty 50 Index Monthly chart, indicates that after three3 Red Crow candles and one Doji (indecisive) monthly candle, as we expected, the Nifty 50 Index monthly candle seems to be closed in Green this month. In the previous week, Nifty tried to cross the high of the doji candle formation in March 2023 month, which was at 17799.95, but again failed to sustain after touching its high of 17863.

We have now only last week's session left in April Expiry, where we could expect the benchmark index to cross the previous month's high, to sustain in the coming months, or else it can drift down further because expectations from corporate results are not in line.

From a moving averages point of view, the Nifty 50 Index Monthly chart is sailing smoothly, because all the candle formations are above 50, 100, and 200 DMA's.

Nifty 50 Index Weekly Chart

As we mentioned in our previous technical journal we suggested that for confirmation of break out we need a follow-up candle, to be closed above the previous candle, but as expected and early retracement formed the new big red candle, which is actually bearish engulfing in nature, which shows a negative sentiment for coming week.

As per technical theory sometimes the retracement from near the top could be a sign of a bullish signal. It may be possible, that after three weeks of continuing green candles, forced traders to book their profit in the previous week, so they can once again try to buy on dips with their fresh capital.,

We can still see one more bullish bout upward of 18000, but this completely depends on corporate results. The result of Reliance Industries and ICICI Bank beats the expectation of the market, so we should wait to see the sentimental expectation in Monday's trading session.

All the candles are smoothly sailing above all the weekly moving averages, so we can not see any big downward trend expectation immediate basis, because the coming week's expiry is monthly expiry and this week would be a volatile week.

Nifty 50 Index Daily Chart

On the Nifty -50 index Daily Chart, we can see that the previous week as soon as daily candles touched the 100 DMA, they got a rejection from there, and all 5 daily candles closed in the red.

Currently, it took support from 200 DMA, where we can see the rejection from the downside on the Friday candle, which is our hope for the coming week, that candles are respecting 200 DMA and the downside is limited for this week.

As you can see that 50 DMA is exactly on 17500, so we should expect volatility we can not be ruled out that 17500 is a very strong support, where we can see a huge bounce back, if it is tested this week at the lower side.

We made this channel, long back on the daily chart, and we can see that daily candles respected the channel, and in the previous week all trading sessions, it was closed above the channel. , so there is hope, they can take support from this channel and reverse back upward. But in any case, if they entered the channel back and the candle closed on a daily closing basis, then we can see the market drifted a little more downside.

Outlook for the NIFTY 50 Index for Coming Week starts from 24th April -2023

Over the coming week, it is important to keep a very cautious and close tab on a couple of things from a technical perspective.