To forecast Nifty for the coming week, we need to have a look at the previous week's high points first of all.
Volumes were low
Missing Volatility
The nifty range was within 270 odd points
Even then gain was 1.96% weekly basis
To understand this, we need to have a look at the USD-INR Chart
The weak Dollar Index has seen strong FII inflows in the emerging markets in general and India in particular. Of the previous nine weeks, NIFTY has closed eight weeks with gains.
Now it is important to keep a close eye on any significant pullback if at all it occurs in the Dollar Index as it is mostly responsible for FII inflows.
Again need to reiterate that Nifty is overstreached and in a consolidation mood. The point to be noted is that Nifty has not ready to move down to 14000 odd levels at present. It seems that bulls are not ready to surrender. But in any case nifty goes down to 13800, it could be a buy on dip opportunity. Broadly speaking the resistance levels for Nifty could be maximum in the range between 14175 and 14320 acting as resistance points. The supports will come in at 13850 and 13700 levels.
The moderate and stock-specific purchase will be recommended, only if some particular sector can do good. Be cautious in approach.
Happy Trading.
Neeraj Bhatia
NSE Technical Analyst