Nifty Today Outlook Report - 07 July 2022

Market outlook on 07 July 2022
Market outlook on 07 July 2022

Market Outlook
by Ruchit Jain Last Updated: 2022-07-07T15:37:31+05:30

Post the sell-off from the 16000 zone in the later half on Tuesday, Nifty started the day on a flat note. The index defended 16800 level in the initial dip and then it rallied higher with a ‘Higher Top Higher Bottom’ formation. The index reclaimed 16000 mark and ended tad below that with gains of over a percent.

Nifty Today:

After some intraday volatility on Tuesday, the index resumed the positive momentum and the broader markets witnessed decent buying interest leading to its outperformance. The momentum readings on the daily as well as the hourly charts are in buy mode indicating further room on the upside. The Midcap 100 index has also given a breakout above its ’20 DEMA’ and a follow up move in the same indicates a buying interest in the broader markets.

In options segment, the call writer ran to cover their positions as the index rallied while open interest addition was seen in 16900 and 16800 put options which indicates that near term support for Nifty is now at 16800. Looking at the above data, it seems that index index could try to complete its 61.6 percent retracement of the previous down move which is placed around 16178. Hence, traders are advised to trade with a positive bias and look for stock specific buying opportunities in the broader markets.

Nifty resumes momentum inspite of intraday volatility

Nifty resumes momentum inspite of intraday volatility

 

Recently, we have seen a high inverse correlation in Dollar Index and Nifty. However, the recent upmove in the Dollar Index has not seen any correction or new lows in the Nifty and this should be seen as a positive divergence. This short term divergence could result in more pullback move in the index as traders with short positions will look to cover up.

 

 

 

Nifty Levels

Bank Nifty Levels

Support 1

15900

34000

Support 2

15800

33850

Resistance 1

16070

34700

Resistance 2

16180

34850

 

 

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About the Author

Ruchit Jain is Lead Research Analyst at 5paisa. He has a vast experience of 14 years in this field and is proficient in Technical and Derivatives Research. He has completed his CMT (U.S.A.) and has done Masters in the field of Finance at Mumbai University.

Disclaimer

Investment/Trading in securities Market is subject to market risk, past performance is not a guarantee of future performance. The risk of loss in trading and investment in Securities markets including Equites and Derivatives can be substantial.

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