WEEKLY ASTRO TECHNICAL GUIDE FOR NIFTY

CLOSE TO STRONG SUPPORT….!!!

Planetary Position ::  During the current week Moon would be transiting  from Pubba  in Leo to Chitta  in Libra.

Sun transits in Chitta   in Libra.

Mercury , in Retrograde motion, transits  in Chitta   in   Virgo  and would be  in retro motion till 25^th October.

Venus transits in  Chitta in Libra.

Mars  transits in   Moola constellation in Sagittarius .  

Saturn transits in Visakha constellation in Libra and in  Gemini Navamsa .  

Jupiter transits in Aslesha constellation in Cancer and in  Aquarius navamsa ..

Venus Sun conjunction (generally referred to as Sukra Moudhyam) depresses values and is generally bearish and Mercury retro motion gives scope for dual movement. Statistics / information during Mercury retro period is generally misleading and unreliable. Grand Square involving Uranus and Sun / Venus is complete and should result in lower volatility and put an end to sudden and swift fluctuations.

Nifty Outlook for Next Week :: (20.10.2014 to 23.10.2014) …  

NIFTY :: 7780 (-80) (Bullishness only above 7925….)

Nifty’as Bearishness continued for the Fourth week and is close to strong support level of 7675. Though Nifty closed below 7800 mark, it is close to 100days’ EMA of 7675 and could offer strong support. With WPI inflation under control, RBI could cut the Bank rates and kick start the downward interest cycle. With falling crude oil prices, diesel deregulation is also on cards With improving macro fundamentals, market can be expected to do better over Medium / long term and Nifty is presently in consolidation mode and market is expecting big bang reforms after the formation of Government in Maharasthtra. Budget exercise also appears to have begun with certain changes in finance ministry officials. Favourable macro economic factors such as falling crude oil prices, lower inflation would positively affect corporate earnings with a lag effect. As market had run up ahead of fundamentals, it is presently in consolidation mode. Much awaited correction in IT index has commenced as TCS Q2 results did not meet market expectation. Further, PSU Bank stocks were beaten down disproportionately due to NPA concerns and are in pullback mode. SEBI’s ban on DLF and promoters from accessing capital market had affected Realty sector stocks. Next  Budget should really be path breaking if the present Government  is fully committed to growth and reforms. Coal block allocation cancellation has affected mining  and related activity and could affect GDP too consequentially. Similarly Gas pricing matter too is affecting economic activity . These Two issues need to be sorted out spur economic growth.

Nifty closed the week  below 50 DMA and appears to have taken support around 100 DMA and might consolidate around the present level. Global cues appear to be distinctly weak and could drive down our market. However, Nifty would get out of the bear grip only if it closes above 7925.

20DMA, 50DMA, 100DMA and 200 DMA are placed at about 7940, 7915, 7740 and 7100 respectively and would

act as supports / resistances. Nifty needs to close decisively above 50 DMA to resume short term uptrend.

Based on the present Government’s agenda, Infra  and Power sectors could come out of their problems soon . Stocks of promoters with proven record may be preferred in these sectors.

Investors need to accumulate quality stocks while traders need to be ever vigilant

Nifty continues to be above 200 DMA and 50 DMA too is above 200 DMA (Golden Cross) suggesting that the long term bullish trend is intact.   Nifty is quoting at a PE of about 20.15, which is about 15% above the long term PE multiple.  Hence, further upside (  8500+ is possible  before next Budget)  

in view of the  stable and performing Government  at the centre as earnings would go up becauseof favourable atmosphere .  IF Nifty stays around the present level for the next Six months, trailing PE could come down to less than 19.50 also making a case for another upmove.

Market is usually ahead of fundamentals and fundamentals need to catch up with the present valuations which could take some time .

Strong long term support would be around 7100

level and Medium term support is 7700.

Technical Levels ::

For the coming week, Nifty spot is expected to face

resistance at 7870,  7955, 8050 and find support at 7690, 7605, 7520.

Minor resistances may be found at 7840, 7890, 7920, 7970  and minor supports at 7715, 7665, 7640 and 7590.

For short term Nifty is bearish  with strong support at 7670 and would become bullish on a close above 7925.  

Advice for Traders ::

With weak global cues, Nifty fell for the Fourth week and is close to 100 DMA. It could consolidate between 50DMA and 100 DMA . In view of the correction for Four weeks, and Diwali sentiment , downside appears limited (subject to global cues). However, short term downtrend would get arrested only on a close above 7925. With a long weekend, it could attract profit booking at higher levels too.