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Nifty 50 - Will it break 19k or will slip into a Prolonged Consolidation Mode?

There is a difference between Weakness, Correction, and Crash. During this consolidation phase, we can say that Nifty50 Index is in a Weakness mode.

At present Nifty50 Index seems to spend some time for rest in a range and wants to slip between a long consolidation range, if it will not break 18887 and then 18929.

Nifty50 - Monthly Index Chart

The nifty50 monthly index chart is showing a small red candle, which indicates weakness. November moth has a lot of struggle to break the level of 19000, once it has broken the Nifty50 all-time high. But the struggle ends only in the red candle, which shows some weakness in the coming month.

Nifty50 Weekly Index Chart

Nifty50 Weekly Index Chart showing started booking profit, once bulls seem to leave the ground. The November month end sums up with a purchase of total shares of Rs 22,546.34 Cr. by FIIs, which helps our market to break the previous all-time high.

But now, it seems bulls are losing ground and they are trying to break 19000, which seems a tough task in the coming week. A long wick on the candle is proof of this point, which has eaten approx 50% of its profit in the profit booking.

Nifty50 Daily Index Chart

The last two days of Red Candles are clearly giving the signal that Nifty50 is either trying to make 3 red candles pattern or Nifty50 is going into prolonged consolidation mode, before breaking the 19000 mark, by maintaining itself staying upside of 18604.

Nifty50 Hourly Index Chart

The recent Nifty50 Hourly Chart is showing that Nifty50 is struggling to maintain an upward move from 25 EMA, and trying to skip to touch the 44 EMA on the chart a little bit upward since the last 5 hours, which is showing that even buyers are ready to purchase but there are a lot of sellers who wants to book profit on higher levels.

In the consolidation of Summary, Big Players have tried their best to create FOMO (Fear of Missing Out) opportunities in retail people, but the new generation of retailers are more smart people than their smart money.

Next Week Outlook starting from 5th Dec-2022

In the coming week if the Nifty50 Index is able to cross above 18887, then the next hurdle will be 18929, which is a major resistance, and if it crosses this level with a huge volume, then nobody can stop the Nifty50 index to cross 19000 mark. And rather higher it can go and touch up to 19200 and 19300 marks also, before coming down to 19100 again.

But if Nifty50 Index could not able to cross 18887, then it can slip towards 18600 levels. 18604 is the major level point to watch, below it, it can go down toward the 18400 level, which is the strongest immediate buying zone.

(Recent Election Results can show some impact sentiments on either side)

In the coming week, starting from 5th December -2022, the Nifty50 Index will have to deal with not-so-strong market breadth.

Ninfty50 Index struggling with playing catchup to the Nifty Bank Index, which may result in a lack of confirmation.

India VIX staying at one of its lowest levels this year, which is at 13.45, So, It is recommended to avoid shorting so long as NIFTY is above 18600 levels.

The markets must be approached with a high degree of caution.

The best method to approach such markets would be to stay highly selective and protect profits at all levels in the markets until the above-mentioned concerns get corrected.

Thanks for reading.

Keep Trading

Stay Invested


Neeraj Bhatia

(Managing Director)

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