Stock Phoenix’s Nifty analysis for the Month of September – 2019

Nifty on Fibonacci

We will study the Nifty movement with the help of Fibonacci numbers. It’s one of the moves important and powerful indicators 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 :

Nifty was in very narrow range for whole month of August with Negative basis through out the month and broken multiple support zones towards the downside. The strong support of 10800 was broken and Nifty gave a new low of 10637. After making low of 10637, Index showed a good sign of reversal. However it could not cross the 38.20% level and closed the month below the levels. As we have got new low, the old values gets invalid and we have drawn a new Fibonacci levels with the help of High which is made on 5th of July and low which was made on 23rd of August. This drawing remains same as long as we do not break the low of 10637.

Currently Nifty is at the levels between 23.60% and 38.20%. Nifty has to cross the levels of 38.20% for the next level of the target on the upper side which is 50.00% and 61.80%. It should not break the low of 10637. Below 10637 we are looking at the crazy downside and the downside number looks scary till the levels of 10500 , 10400 and 10000.

Targets for the Month of September – 2019

As we now arrived at a support zone in between two Fibonacci Numbers, Now we can easily arrive at the next set of targets. If the Nifty stays above the zone of 10954, we can expect the first Target as 11150, the second target of 11210 which is 200 days moving average which is very important. Once the important level of 11200 is taken out, then the Nifty target is open till 11309 and 11468. And the levels at 50% will not act as strong resistance.

At the same time if the Nifty breaks the zone 10954 then we can see the first target as 10637. The index will start bouncing back from the zones of 10637. Any closing below 10637 will give room for the downside to the levels of 10500 and 10400. If we look at the charts, ideally we have support at every 100 points below 10400 till 10000.

What are the possibilities of Nifty breaking the low or travel upside in the Month of September?

Nifty has made enough bottom in the Month of August and we are in oversold territory. some sort of technical bounce back should happen and we had already seen the reversal and Index is trading above 23.80% levels. However, it all depends on the National and Global scenario. If we don’t see any news which affects majorly, we can expect Nifty to hold the low and travel towards the north side and we should be seeing a good recovery from here on. If we end up getting some negative news, then we can plan for further downside targets as explained.

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 Option chain.

Weekly Expiry – 05th of September

Today is the first day of the month and we cannot arrive at the exact target for Index. However, we can arrive at the overall picture with the help of Option chain writing. Looking at the option chain, we can arrive at the below inference.

We can see a good amount of support is getting built in the zone of 11000. Hence 11000 will act as crucial support for the second week of September. And at the same time, we also have resistance at the levels of 11100. The overall PCR ratio is showing neutral sentiment. Now we have to see if Index holds 11000. And being Monday is holiday and we have some positive news from India and some Negative news globally. Now we should wait and watch as how Market will react to the different news. Stay tuned with Stock Phoenix Telegram Channel for more live updates.

Monthly Expiry

It’s too early to predict on Monthly Expiry. The overall PCR ratio suggests bullish. As of now, we could see strong support is getting built up at the zones of 11000, 10800 , 10700 and 10600 and resistance at the levels of 11200 and 10700. We see much support zones on Monthly chain when compare to the resistance zones. However, it’s too early to arrive at this conclusion. However, the good part is even on the monthly expiry the support lies in the zone of 11000. So the chances of hitting 38.20% and 50% are high and we may head even 61.80% which is 11468.

Immediate Target and resistance

  • Upside Targets: 11150, 11210, 11309 and 11468 (Above 10954).
  • Downside Targets: 10637, 10500, 10400 and 10000 (Below 10954)
News that will affect the Nifty Movement

As you are aware that we are on the series of news such as changes in Tax slabs, downward journey of Auto Sectors, Infra related news and other banking-related news. So this factor will affect the Movement of Index. So we have to keep this factor in the coming week. So overall we are eyeing at the volatile month ahead and we might see a good recovery if we get enough positive news from National and globally.

Conclusion form Stock Phoenix :

We see Index bullish on near term and expecting index to recover from the low and give some sort of relief. Let’s wait and how and what market shows ahead for us. Play safe on the intraday and avoid carry forwarding any kind of option for the next day. And we may not even get a good time to start your investment portfolio in the Month of September as well. Almost all the small-cap and mid-caps are fallen massively and still falling nonstop. Once we see a sign of recovery in Index, these also will follow the big boss and we should take advantage of this and start our strong holding on Investment for the next big round of move.

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