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Nifty - Crucial & In Unchartered Territory with Low India VIX

In the previous week, the benchmark index Nifty traveled in a wider range of 555 points It opened at 18682.35, touched a low of 18646.70, and then jumped to cross its previous all-time high of 18888.70, before closing at 19189.05, near its new highest level of 19201.70

The Nifty 50 Index, gained 523.55 points (+2.80%) on a weekly basis. On a monthly close levels benchmark monthly gained 654.65 points (+3.53%).

Nifty 50 Index Monthly Chart

The Nifty 50 Monthy Chart index looks strong and was successfully able to close the third monthly green candle above the closing of the December 2022 month's level, which was the previous all-time high. Now the all-time high stands at 19201.70.

Nifty 50 Index Weekly Chart

We made and followed this channel for a quite few weeks. It seems in the previous week, the Nifty 50 Index weekly chart, tried to give a breakout and was able to close successfully above this channel. Now we need another week's follow-up candle on a closing basis above the previous week's close, only then we can accept that this breakout is real.

Nifty 50 Weekly Chart (Fibonacci Chart Status)

We discussed regarding 100% level, in our last week's technical journal, that it may cross, and then it can move further.

Now Fibonacci levels could have a very big target, but before reaching 161.8% level, let me introduce baby steps, the benchmark index to face as resistance and those levels 19448, which sits on 127.2% levels and then the next one is 19741, which sits on 141.4% levels.

So we can say, before reaching the highest level, we can not rule out that the index can have multiple retracements because this is a fact that Index can not move in a straight direction in a single journey.

Nifty 50 Index Daily Chart

The four straight-upward green candles, clearly show that it happened forced short covering with the help of cash buying to break the previous all-time high to create a new all-time high. Whatever it is, now the sentiments are so strong that could force the benchmark index to touch 19448, but one small retracement can not be ruled out in between.

FIIs Monthly Activities

FIIs Previous Week Activities

FIIs are showing full faith in the Indian stock market and they are extending their buying in cash, in the previous week with approx 20k numbers. Their monthly buying is matching with the May month's buying figure.

For the short-term view, FIIs are bullish with the Future index number souring up to 72.4K numbers.

Outlook for the NIFTY 50 Index for Coming Week starts from 26th Jun 2023

Some positive developments, which we can not ignore, boosted investors' sentiment during the week.

1. The strong progress of the southwest monsoon is positive

2. Global data (including US Q1CY23 GDP and surprise fall in jobless claims),

3. Narrowing current account deficit in Q4FY23

4. Healthy FII inflows

5. HDFC-HDFC Bank merger Completion

The benchmark indices ended at a record closing high. as the benchmark indices hit historic highs in the week ended June 30, with buying across sectors.

An important point this time is that the Nifty Midcap 100 and Nifty Smallcap 100 indices gained 2.7 percent and 2 percent in a week, taking June month rally to 6 percent and 6.6 percent respectively.

Overall, the markets may remain buoyant in the coming week too, but small correction or consolidation given a healthy run can't be ruled out intermittently

Corporate earnings season will start in the second week of July month. Now, the focus gradually shifting to June FY-24 quarter earnings expectations,

investors would also watch out for FOMC minutes to get insights into the US Central Bank’s future course of direction.

India VIX

The previous week India VIX closed at 10.80 from 11.23. the lowest level since December 2019, It is down by 3.87 percent for the previous to the previous week.

Trading Range

1. Immediate Trading Range - 19000 to 19400

2. Broader Trading Range - 18800 to 19500

Support Level for the Coming Week for NIFTY:

The broader support level on the technical chart could be in the range of 18900 followed by the level of 18680.

Resistance Level for the Coming Week for NIFTY:

The broader resistance level on the technical chart could be 19280 followed by the levels of 19400

With the all-time high (now previous) level taken out which was a resistance earlier, this level is expected to now act as support in the event of any consolidation from current levels.

The derivatives data also shows maximum PUT OI built up at 19000; this makes the zone of 18900-19000 the immediate support area for the markets. The NIFTY 50 Index will have to stay above this point to be able to confirm and extend the current breakout

If the market extends to its highest point, we can see some strong stock-specific activities from high-beta sectors. This would include banks, auto, and energy and would also see sectors like IT and Pharma doing as well.

While chasing the market upside, It is strongly recommended to be stock-specific and book profits regularly.

Thanks for reading.

Keep Trading

Stay Invested


Neeraj Bhatia

(Managing Director)

Disclaimer: I am not a SEBI Registered technical Analyst, so consult your financial advisor, before taking any trade. This technical weekly post is only for learning purposes and its a free of charge. The views written here are completely my personal view only. I am not suggesting here anyone to follow my views. I do not have any WhatsApp Group ID or Telegram ID related to it.

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