Future Retirement Success
  • Politics
  • Business
  • Investing
  • Stocks
  • Politics
  • Business
  • Investing
  • Stocks

Future Retirement Success

Stocks

Week Ahead: Ranged Movement Expected In The Truncated Week; These Levels Stay Crucial

by January 21, 2023
January 21, 2023
Week Ahead: Ranged Movement Expected In The Truncated Week; These Levels Stay Crucial

Over the past couple of weeks, it is being categorically mentioned that so long as the NIFTY stays below the 18300 levels, it is likely to continue to consolidate in the present range. The index has created a very well-defined trading range for itself at the moment and continues to stay within the defined boundaries. Markets witnessed mixed trends throughout the previous week. It stayed quite ranged and the trading range too remained narrow as the NIFTY oscillated in a 330-point range in the past five sessions. Whiles not showing any directional bias, the headline index closed with a modest gain of 71.05 points (+0.40%) on a weekly basis.

We have a truncated week lined up; January 26th is a trading holiday on account of the observance of Republic Day. There is no major change in the overall technical setup that was seen at the beginning of the previous week. It is important to note that it is now the fifth week in a row that the NIFTY has taken support on the 20-Week MA; the 20-Week MA currently stands at 17907. This level also lies in close proximity to the 100-Day MA which is placed at 17937. This makes the zone of 17900-17940 a strong support area for the NIFTY; only a slip below this point will invite incremental weakness in the markets.

Volatility dropped; INDIAVIX came off by 4.65% to 13.75 on a weekly basis. The coming week will see the Index facing resistance at 18300 and 18480 levels. The supports come in at 17900 and 17760.

The weekly RSI is 54.42; it stays neutral and does not show any divergence against the price. The weekly MACD stays bearish; it trades below its signal line. A spinning top, close to being called a Doji appeared on the candles. The emergence of such a candle near the support area lends credibility to the support.

The pattern analysis of the weekly chart shows that NIFTY is taking support at the 20-Week MA which is placed at 17907 for five weeks in a row. This makes this point a crucial support for the index coupled with the 100-DMA on the shorter time frame chart. Overall, the NIFTY is unlikely to take any directional bias so long as it is in this trading range; a sustainable directional bias would emerge only if the NIFTY moves past 18300 levels or slips below 17900 levels.

The overall technical setup remains nearly unchanged this week as compared to the week before this one. All the markets have done is to just consolidate within a given range and head nowhere. As the markets head towards the Union Budget which is one of the most important external domestic events, it is likely to consolidate with a positive bias. We will see sectors like PSE, IT, etc., doing well. The Dollar Index stays weak, if it stays this way then it is likely to auger well with the commodities and metal stocks as well. The action in the coming week is likely to stay stock-specific; it is strongly recommended that the overall exposures should be kept at modest levels until a distinct directional bias is established. While staying light on positions, a cautiously positive outlook is advised for the coming week.

Sector Analysis for the coming week

In our look at Relative Rotation Graphs®, we compared various sectors against CNX500 (NIFTY 500 Index), which represents over 95% of the free float market cap of all the stocks listed

The analysis of Relative Rotation Graphs (RRG) does not show any major changes in the sectoral setup as compared to the previous week. Despite being placed in the leading quadrant, the Metals, PSU Banks, Financial Services, and Services Sector indexes are seen taking a bit of a breather. However, they will continue to relatively outperform the broader market NIFTY500 index along with Nifty PSE, Infrastructure, Commodities, and Banknifty which are also placed inside the leading quadrant.

No sector is currently placed inside the weakening quadrant.

Nifty Realty and the Media sector indexes are seen languishing inside the lagging quadrant. They may relatively underperform the broader markets. Besides these sectors, the Auto, Pharma, Midcap 100, FMCG, and consumption sectors are also placed inside the lagging quadrant. However, they appear to be improving on their relative momentum against the broader markets.

The Energy and the IT sectors are placed inside the improving quadrant. They may continue to show resilient performance against the broader markets.

Important Note: RRG™ charts show the relative strength and momentum for a group of stocks. In the above Chart, they show relative performance against NIFTY500 Index (Broader Markets) and should not be used directly as buy or sell signals.  

Milan Vaishnav, CMT, MSTA

Consulting Technical Analyst

www.EquityResearch.asia | www.ChartWizard.ae

0
FacebookTwitterGoogle +Pinterest
previous post
Why UK SME’s could be saving time and money by using AI tools like ChatGPT
next post
Judge orders Trump to pay $1M for ‘frivolous’ lawsuit against Clinton, Comey, Schiff

You may also like

Stocks at a Crossroad

August 26, 2022

The Perfect Chart for Navigating 2022

October 28, 2022

At the Edge of Chaos: Contrarians Investors with...

January 9, 2023

This Industry Group Outperformed the S&P 500 by...

December 13, 2023

Why is S&P 4400 So Important Right Now?

November 11, 2023

GREAT News: This Bull Market is Expanding!

March 16, 2024

The Wisdom of Jesse Livermore, Part 8

June 21, 2023

Stock Market Pushes Higher, But Is There a...

June 13, 2024

DP Trading Room: Dividend Investing

August 29, 2022

The Fed Wants to Raise Rates as Russia...

June 26, 2023

    Get free access to all of the retirement secrets and income strategies from our experts! or Join The Exclusive Subscription Today And Get the Premium Articles Acess for Free

    By opting in you agree to receive emails from us and our affiliates. Your information is secure and your privacy is protected.

    Recent Posts

    • Business Settings that Need Rolling Shutters

      May 15, 2025
    • What’s Driving the Drop in Overdose Deaths?

      May 15, 2025
    • The real breakthrough in U.S.–China trade talks is much bigger than just tariffs

      May 15, 2025
    • Dem senator says ‘no doubt’ Biden declined cognitively during presidency

      May 15, 2025
    • Trump makes historic UAE visit as first US president in nearly 30 years

      May 15, 2025
    • GOP reps, advocacy group to target competitive House districts in Trump tax-cut push

      May 15, 2025

    Categories

    • Business (7,967)
    • Investing (1,960)
    • Politics (15,230)
    • Stocks (3,084)
    • About us
    • Privacy Policy
    • Terms & Conditions

    Disclaimer: futureretirementsuccess.com, its managers, its employees, and assigns (collectively “The Company”) do not make any guarantee or warranty about what is advertised above. Information provided by this website is for research purposes only and should not be considered as personalized financial advice. The Company is not affiliated with, nor does it receive compensation from, any specific security. The Company is not registered or licensed by any governing body in any jurisdiction to give investing advice or provide investment recommendation. Any investments recommended here should be taken into consideration only after consulting with your investment advisor and after reviewing the prospectus or financial statements of the company.

    Copyright © 2025 futureretirementsuccess.com | All Rights Reserved