Saturday, August 29, 2020

Week of August 31 to September 04 2020

 We had expected stability to return to the markets last week. Uranus retro also was to positively impact the markets. And we saw that last week and how!

Nifty had opened at 11412 on Monday, August 24th and steadily rose to close at 11647, on August 28th, Friday.A gain of 235 points.

Bank Nifty opened at 22437 and rose throughout the week to close at 24611, a rise of 2174 points. Spectacular, indeed! Obviously the star parivarthana between Jupiter and Venus was helpful! The energy flow was better between these two financial planets because they were also directly opposite to each other on August 25. 

Let us see how things look in the coming week starting on Monday, August 31, 2020...

This is what we had mentioned last week.."Nifty started its new cycle on August 14th and by August 19th, it faced significant gap resistance in the area of 11433 to 11536.Nifty moved up to 11460 but then retreated needing more energy to cross the gap."

Nifty found the energy this past week to vault pass the  11536 mark to close at 11647. 

Where did the energy come from?

Liquidity of course!

See this...

Coming back to the Nifty chart, we see that for every sub cycle from May 18 ( shown in thick blue lines ), the market had topped out within a maximum of 14 days..This is shown in red dotted lines.

So the first sub cycle  of 18 days,topped out on the 14th day 

Second sub cycle of 9 days, topped out on the 8th day...

Third sub cycle of 13 days, topped out on the 12th day...

And so on..

The current sub cycle is already 10 days old. So we can expect a correction within the next few days. Either this coming week or early next week. So have tight stop losses for all new bull positions.

Correction if and when it happens, could be to the 20 day average support line. Currently it is at 11315.

Because of the persistent global liquidity, corrections are generally shallower and rallies are more prolonged...Yet a long position without a stop loss can hurt like hell!

From a top of 12430 on January 20, Nifty has retraced 84% from 23 March bottom of 7511.The next resistance area is between 12152 and 12247.

Fibo extension from July 14th swing low also points out that Nifty is close to 100% extension level of 11671, ( Nifty had closed at 11647 ).The 161.8% extension level is placed at 12145. We have already mentioned that 12152 to 12247 is a significant resistance area.

Compared to Nifty Bank Nifty was more bullish...

Bank Nifty has stiff resistance in the 200 SMA area of 25116 and 261.8 % fibo extension area of 25316 just 523 points away....And Bank Nifty is a very very liquid counter. So take care.

As shown abo

As shown above in Bank Nifty Futures, the last green candle had happened on high volumes...pointing out to bullishness in the counter..

Coming to the constituents of Bank Nifty,

Coming to Nifty constituents, here is a list of best performers inside Nifty....Again it was the Banking sector which was shining..

Here is a list of laggards...inside Nifty. Mostly from IT and FMCG Sector.Their respective weightage are given in brackets for instant understanding.When Reliance and IT Majors like Infy and TCS do not move, Nifty also moves tentatively, even if Bank Nifty fires on all cylinders.

 We can see that Reliance was largely flat throughout August 2020. It is consolidating..

Exactly similar is the case with Nifty IT...A flat consolidating trend throughout August
Earlier when Reliance and IT were firing, it was Bank Nifty which was acting as a dampener. Now it is the other way..Bank Nifty has come out with guns blazing, Reliance and IT Stocks have gone into a shell.

Coming to the market as a whole, here are some sectors which have performed better than Nifty, in August.Stocks from these sectors are likely to grow faster...

Indices which are under-performing Nifty in August 2020

And sectors which are showing signs of cooling off.....

Astrologically speaking,

We are in a time zone where the faster moving planets Mars, Sun, Venus and Mercury are engaging with Jupiter, Pluto and Saturn with rather explosive results.

First it was Sun connecting with Jupiter, Pluto and Saturn by way of opposition  between July 13 to July 21, 2020. Markets dipped and then rose to new highs by 28/29 July. 

Then it was Mercury connecting with Jupiter, Pluto and Saturn between July 30 and August 03.We saw a significant low forming on August 03, when Mercury was connecting to Saturn,

Mars took over on August 03 and connected with Jupiter, Pluto and Saturn by way of a square between August 03 and August 24.Market continued to be bullish expect for corrections caused by Uranus retro and Sun Mercury conjunction on August 17. Mars square Saturn effects are expected this week. 

Meanwhile Venus started connecting with oppositions to Jupiter, Pluto and Saturn from August 25th to September 02nd, when Venus will square Saturn.This is pointing to a sub cyclical top, which is further underlined by Sun connecting to Uranus by way of a trine on September 02.We may expect some sudden reaction in the market causing a fall. Mar square Saturn effects also favour a bottom formation.Of course, every fall is a good buying opportunity.

With Jupiter moving towards a final sextile with Neptune on October 12, we may expect bullishness to continue, but with volatile reactions.

Let us flow with the money, but also take care not to lose our Stop losses.

Sunday, August 23, 2020

Week of August 24 to 29 2020

 Last week we had expected instability from Ketu because Ketu is Gandantha and several planets 

including Ketu are in Ketu star.

We saw that this week! One day opening gap up and the other day opening gap down.

In the beginning of week of August 24, Moon has moved out to Libra and is in Swathi ruled by Rahu.

Mercury also has moved out of Ketu star.Only Sun and Mars are in Ketu star apart from Ketu himself. So 

we may expect stability to start returning to the market.

The most impressive aspect this week is the square between Mars and Saturn.We are also in the active orb for Uranus retrograde.Any dip in the market this week is a good opportunity to buy for possibly the final bull run this season.

Star parivarthana between Venus and Jupiter also is a good sign for the bulls...possibly after a intra week dip.

Nifty started its new cycle on August 14th and by August 19th, it faced significant gap resistance in the area of 11433 to 11536.Nifty moved up to 11460 but then retreated needing more energy to cross the gap.

See the longer picture here...

Break of this gap will propel Nifty forward..

If the resistances for Nifty go back to February-March of 2020, the resistances for Bank Nifty are more recent.

While Nifty is comfortably above 200 MA, Bank Nifty is still behind its 200 MA. However, Bank Nifty had overtaken Nifty in its momentum by August 17th.Hopefully BN will catch up with Nifty.

Market breadth is good and there is broad participation.

Investing in break out stocks which do so with volume is a strategy which will yield good results.
Some interesting stocks:
Stocks which have broken out of resistance may be purchased on pull backs.

Trade safely, slowly and profitably. 

Sunday, August 16, 2020

Week of August 17 to 21, 2020

 Nifty opened the week at 11270, a good 56 points above previous week close of 11214.Moved up to 11337 to 11373 range but met with continued supply and so declined.Bull power decreased on Thursday and by Friday, Nifty declined 122 points and closed at 11178, 36 points less than the close of   August 07th.

After May 22nd, this is the first time we are seeing two red candles on the weekly in three weeks.It is a sign of increasing volatility.

Coming to Daily charts,

Nifty has declined about 50% of the up-move from August 03.Sub cycle wise we have completed 9 days from the cycle bottom of August 03.We may expect this cycle to bottom out early in the coming week.Then the next up-cycle may commence.Once Nifty closes above previous cycle top of 11341, up-move may accelerate.

Technically, Bank Nifty is weaker than Nifty.As shown above, a decline to 21000 may be expected this week and then the next bull cycle commences.23000 needs to be taken out convincingly for Bank Nifty to accelerate its move up.

On August 04, Mars was at a Kendra to Jupiter.On August 13, Mars squared Pluto and on August 24, Mars shall square Saturn.and today evening, Mars will move into Aries, a house owned by Mars.Mars moves into Aries in Navamsa also which makes it very powerful

Mars is in Ketu star. Ketu is also in Ketu star but  in last two degrees,moving towards the exit of Sagittarius.Astrologically such a placement is called Gandantha and makes the planet unstable.

By August 19th, Sun, Mercury and Moon also will be in Ketu star.Mars is already in Ketu star. So the instability of Ketu can get translated to these other planets for a short period of time.

On August 16/17, Sun and Mercury become conjunct and they both trine Mars! So the energy flow could be intense.

Add a Uranus retro also this week on August 17th.Uranus causes sudden upmoves or crashes like the one we saw on Friday.Uranus causes the markets not to respect levels for a brief time. So we need to be cautious.

This could also be a great buying opportunity for the next bull cycle.

Sectors ruled by Mars, such as   Construction, Engineering, Defense and Metals should shine after the hiccup caused by Ketu.

Since Rahu is also in Mars star, we may expect Chemical Industry also to do well.

This is a list of ten companies which have appreciated the most against Nifty since June 12.Check the liquidity and fundamentals before investing. The move has several more legs, since Rahu will be spending more time in Mars star.

That is all for this week folks! Have A Great Week!

Sunday, August 9, 2020

Week of August 10 to 14 2020

 Nifty had declined further on Monday August 03rd and formed a low at 10882.25, which was what we had expected last week. Nifty had taken support near 200 day SMA ( 10858 ) and then began to move up throughout last week and closed on 11214.05 on Friday.

We have seen hesitant starts for the past sub cycles and cycles in the current segment from March 2020.True to form, after one bull candle on Tuesday, Nifty has been hesitantly moving forward.

Nevertheless, we are cautiously optimistic that the cycle from May 18, is completed on August 03rd, after 54 trading days, which is very close to a Fibo number 55.Confirmation comes only when Nifty takes out the previous cycle high of 11341.40. In the new sub cycle, Nifty has completed 5 days so far. Nifty may move up quickly early this week or may bob around for a day or two and then start to move. Either ways an up move is on the cards.

This up- cycle maybe more volatile  than the other two. There are several astro pointers. One on August 17th is Mercury catching up with the Sun and Mars squaring Saturn and Pluto.One more major planet, Uranus goes retrograde on August 15th. September sees Mars going retro and Jupiter and Saturn becoming Direct,.

Critical for Nifty moving up is Bank Nifty, which has a weightage of 22.96 % as of July 31, in Nifty.


 While Nifty`s other constituents have been moving up, Bank Nifty has been moving sideways. It is at the control price of 21770.

On the contrary Reliance and Nifty IT Stocks with a combined weightage of more than 30% have been batting for the bulls.

We all know about Reliance and why it is an out performer and why it will continue to outshine others.

Let us look at IT alone more closely.

It is imperative to hold some IT Stocks in our portfolio!.

Another interesting observation in this rally is the participation of Mid cap and small cap companies.

Summing up we expect Nifty to move up, after some small hesitation and take out the recent previous high of 11341...

Have a safe trading and safe existence!

Sunday, August 2, 2020

Week of August 03 to 07, 2020

Last week, between July 27 to 31, 2020, Nifty hit a high of 11341 on Wednesday and has been declining since then.We had expected the market to improve by about 250 points and then show some correction. Nifty did exactly that.From a low on July 24th of 11090 Nifty moved up to 11341 and has been declining.
Nifty cycle has now completed 53 days ( quite a stretch! ) and the ongoing sub cycle has completed 13 days. While Nifty has seen some decline, it is hardly sufficient to conclude a cycle. Our take is that some more decline is in the offing this week.
If 11037 is breached this week, we can expect support between 10654 to 10437.

 Nifty Fibo extensions are also pointing out that this week is an important one for the markets.
By and large Nifty has been maintaining its movements along the control price ( shown by the red arrow ) and has not shown any decisive weakness as yet.
On the contrary, Bank Nifty has slipped out of the value zone after playing below the control price for a very long time.This weakness will have a bearing on Nifty.

There are several astro aspects crowding in on the week.
Mercury is following Sun in opposing Jupiter, Pluto and Saturn.
Mars and Mercury have completed their angular aspect for the third time.
August 03 also happens to be the orb date for triple opposition of Sun with Jupiter, Pluto and Saturn.
Sun squaring Uranus mostly point to a top formation. The question is, has the short term top already formed on July 29? We will know this week!
Finally Venus meets Rahu in Mars star, on August 05th.Once Venus is free of Rahu, markets could look up.
So, we expect Nifty to be bullish in August with some volatility. In the near term, some more correction is expected before Nifty starts another bullish cycle.

Stay safe, yet be productive!