Market Analysis for May 09, 2022

Weekly Market Report & Nifty Chart Analysis

1. Last week Nifty Futures made a high of 17137 and from there it made a low of 16346. That is a fall of almost 800 points. Finally, Nifty Futures managed to close slightly above 16400.

2. 16400 is a crucial level as Nifty Futures has bounced back significantly from that level the last 2 times. Also in the Weekly chart, the close has not been below 16258 since last August. So, the 16250 and 16400 zone will be the crucial ones on the downside for the coming week.

   

   Nifty Futures - 1 Week Chart

3. IndiaVIX shot up by 5% on Friday and it is now above 21. It has been trading between 19 to 21. Even the US CBOE VIX shot up from 25 to 35 last week before settling at 30.

4. Both Nifty and Banknifty Futures are trading with relatively lower premiums. Sometime in April Banknifty was trading at a rich premium of 300+ points. Now it is trading at a premium of less than 100 points. So, the confidence isn’t there yet.

5. US market traded with extreme volatility on Friday. Although it ended in red, there was a short rebound towards the end of the day.

6. Most Global markets closed the week in the red. Japan was an exception.

   

7. All sectors ended in red last week with Realty and Media being the worst hit.

   

8. Most of the stocks in the broader market have fallen in recent times. However, there are a few stocks that are standing strong even in these tough times. Here are some.

   

9. FIIs sold for ₹5500 crores on Friday. They have added huge short positions on the Index. Their highest in the last 1 year. FIIs are bearish.

10. If you look at the Nifty Open Interest across expiries, CALLs were added significantly at 16500. So, 16500 will be the immediate resistance. On the PUT side, participants added positions at 16000 and it has the highest PUT OI. Market Makers are Bearish.

11. RBI hiked the interest rates suddenly last week due to the rising inflationary environment. Inflation data for April is to be released this week. Something to watch out for.

12. LIC IPO will be closing tomorrow. It has received a decent response with the Retail portion subscribed 1.59 times.

13. Delhivery & Venus Pipes IPOs to open this week.

14. Tata Motors, Asian Paints, CIPLA, L&T, Tech Mahindra, etc to announce results this week.

Let’s now move on to the charts & price action.

Positional Trading Analysis for this week (May 09 to 13, 2022)

• Bearish as long as Nifty Futures closes below 16448 in the Daily Chart. Support on the downside being 16354, 16234, 16159 (Marked in Green).

• Bullish only if the Nifty Futures closes above 16647 in the Daily Chart. Resistance on the upside being 16844, 16982, 17095 . (Marked in Red).

• We will maintain a Neutral view if Nifty Futures trades between 16448 & 16647 (between the Blue levels).

The above analysis is for Positional Trading (1 Day Chart) and for this week only. For Intraday Analysis (5 minutes Chart) of Nifty, Banknifty & Stocks, and other useful tools, please check the Finvezto Toolkit. Toolkit enables independent research and helps you make wise trading & investing decisions.

Disclaimer: The analysis is for educational & informational purposes only. Please consult your financial advisor before taking any trading/investing decisions.