Nifty on Fibonacci
We will study the Nifty movement with the help of Fibonacci numbers. It’s one of the most important and powerful Indicator that will help us to arrive at the Targets for the reversal trend. It’s drawn by arriving at the top and bottom of the trend and it’s drawn to arrive at the next set of support and resistance. The higher the Time Frame, the better the results. Here we have taken the Daily charts to draw the Fibonacci Numbers. The drawing remains the same until we get a new high or new low by Nifty. Numbers 38.2% and 61.8% are considered as very crucial in the Fibonacci series
Nifty Analysis :
For the Month of April – Nifty has a good amount of recovery. However, this move not backed by any positive news. The Market is still on bearish mode due to Corona News and Lockdown. the further rally in the Market will be based on how the Lockdown will get over and how the companies will start performing and come back to BAU mode.
Let’s look into the more on Nifty move with the help of Technical tool Fibonacci. We love doing Nifty Analysis based on this Magic Tool and you all know the importance of the same.
We have drawn the Fibonacci Series based on the Swing high which has made on 14th of February at 12246 and the low which was made on the 24th of March at 7511. Now we have arrived at all the Retracement levels. And these levels will remain the same until 12246 or 7511 broken. However, the entire retracement levels will change if we get any new trend reversal in between. We will keep updating on the live level in our Telegram Channel.
As per the new Fibo Levels, Nifty took a lot of time to cross the level of 38.20% which stood at 9320 and this stayed as Magical number for quite some time. And finally, on the last two of the month, it crossed this zone and gave the Intermediate Target levels which is at 9878 and this is the 50% Fibo level.
On the last day of Expiry Nifty hit the Target at 50% and failed to close above the Same. As we know that any strong closing above the Fibo number will open the doors for the next number. So if Nifty would have closed above the Fibo number, then the next Target we are looking at an important level which is 61.80%. So the Ideal Target on the upper side we are looking at 10437.
So we are looking for the Bull run above 9878 with the potential Target of 10437. And bear runs below 9878 with the potential Target of 9320. And 9878 is 50% and Index just closed below 9878 and this is not good sign for Bulls.
Targets for the Month of May- 2020
As the Nifty has closed below the 50% and this is a sign of bearishness. If Nifty breaks 9879 then it will travel high towards 61.80% and if it remains down, then it will fall back to the next support level which is 38.20%. Breaking 38.20% will lead the Index to hit again 8000 and 7511.
- Upside Targets: 10150 and 10437 (Above 9878).
- Downside Targets: 9320, 9000 and 8628 (Below 9878).
What are the possibilities of Nifty going towards Bull run for the month of May?
Nifty has been falling since the 14th of Feb due to various reason. Twice it gave the dead cat bounce recovery. However, we need U shape recovery rather than V shape. And this recovery has to be slow below follow by positive news on the current panic situation. The entire county is on Lockdown mode since a month – All the services should resume to the normal situation and the growth should start. The Bull is far away by keeping the current situation in mind. And the once the upside run stats, We will have a very big run.
Even though the Fibonacci numbers are very accurate, the Fibonacci analysis does not tell anything about the timeline to achieving the targets. For the time frame, we have to take the help of the Nifty Option chain. The near term target can arrive with the help of the Option chain.
Weekly Expiry – 07th of May
No Views as per the Option Chain as the Option volume is very low and India VIX is still too high. We will update the view once volume increases and follow our Telegram Channel for more updates.
News that will affect the Nifty Movement
Wait for Lockdown and Corona Update. And the Stimulus package.
Conclusion form Stock Phoenix :
Stay Alert – The last week Bull rally was not backed by any news – we are expecting to have one more dip in the Index and slow recovery from thee on.
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