Charts suggest strong momentum in these two stocks; Nifty to face resistance at 16,700

Charts suggest strong momentum in these two stocks; Nifty to face resistance at 16,700

Bank Nifty has continuously underperformed the Benchmark index on all the time frames which is visible of relative strength (RS) indicator. (Image: REUTERS)

By Rohan Patil

It was a very volatile week where Nifty traded with a mixed bagged and registered its lifetime high of 16701.85 levels on 18th Aug and formed a bearish dark cloud cover candlestick pattern during the closing and continued its selling and confirmed the bearish pattern setup by closing below the bearish dark cloud cover pattern in its next trading session.

We are also approaching the 20th anniversary of the Taliban’s removal from power in Afghanistan at the hands of US-led coalition forces. Now that the Taliban has again prevailed, we should consider whether its victory over the world’s most powerful military and the largest economy will have any implications for the dollar and its role in the world.

The Benchmark index has formed a bearish harami candlestick pattern in the weekly time frame at the all-time high levels, the bearish pattern will be confirmed when the prices will close below the harami pattern. Momentum oscillator RSI (14) has dropped sharply from its overbought levels and currently reading at 65 levels with bearish crossover on the daily interval.

The immediate support for the Nifty is placed near 16200 levels and resistance is pegged near 16700 levels.

BANK NIFTY

Bank Nifty has witnessed an upward rising trend line breakdown on 20th Aug on the daily time frame. On the weekly chart, prices have drifted for more than three per cent and have closed below its trend line support.

Prices have made multiple attempts to break the resistance levels placed at 36300 – 36400 levels but were unable to breach the upper band of the horizontal trend line on the daily scale. Prices have drift below their 21 & 50-day exponential moving averages on the daily interval.

Bank Nifty has continuously underperformed the Benchmark index on all the time frames which is visible of relative strength (RS) indicator. The majority of the indicators & oscillator has indicated a negative trend for the banking index.

The banking index has filled its runaway gap which was created on 4th Aug due to a gap up opening. Currently, prices are trading in the middle of the rectangle pattern and the lower band of the pattern is supported with a 100- day exponential moving average.

The immediate support for the Bank Nifty is placed near 34400 levels and resistance is pegged near 36200 levels.

Aurobindo Pharma : BUY

CMP: Rs 681.80 | Target RS. 730

Stop Loss Rs 653|Return 07.20%

On the daily chart AUROPHARMA has completed ‘Bullish Crab Harmonic pattern’; the coordinates of which are:

XA leg is from 797.30 to 1063.90

AB from 1063.90 to 917.75 (which is 61.80% of XA leg),

BC leg is from 917.75 to 1013 (which is 61.80% of the AB leg) and

CD leg is 1013 to 681.05 (which is 361.80% projection of BC leg & 161.80% retracement of XA leg).

Momentum oscillator RSI (14) has reached near extreme oversold level (10) and a sharp bounce back from the current level cannot be ruled out. Volume activity has increased significantly from the past few trading session indicates accumulation phrase in the oversold conditions.

Based on the above Technical studies we can come out with a view that the price may move towards higher levels over a short period.

Bharti Airtel: BUY

CMP: Rs 613.70 | Target Rs 660

Stop Loss Rs 590 | Return 07.50%

BHARTI AIRTEL has witnessed a retracement near its trend line support post-breakout of a triangle pattern on the weekly time frame. Prices have retraced 23.60 percent from their previous intermediate high of 644 levels.

Stock is trading above its 21, 50 & 100- day exponential moving averages on daily time frame, which is positive for the prices in the near term. MACD indicator is reading above its centerline with positive crossover above its signal line. Momentum oscillator RSI (14) is reading near 60 levels which indicates positive momentum will like to continue ahead.

(Rohan Patil is a Technical Analyst at Bonanza Portfolio. The views are expressed are the author’s own. Please consult your financial advisor before investing.)

Chiliz Price Analysis: CHZ Token Trading Inside Cloud, Indicates Neutral Move

The CHZ token is decreasing downwards, around -20.9%, during the intraday trading session.

The 24-hour trading volume is at $784 million.

CHZ/BTC pair is also trading negative by -11.5% at 0.00000714 BTC.

Daily technical chart and CHZ token trend is showing a downward trend. Based on the pivot level, the initial support level is 0.27 USD. From another perspective, if it accelerates, the resistance level to watch is 0.43 USD. Although the chart created a bearish harami candlestick pattern during the day, the price is expected to be a downside with medium reliability.

Ichimoku Cloud is composed of lead-1 and lead-2, and the displacement value is 1. It operates as a pivot level and leading indicator of asset price changes. Investors can see that the price slips below the Green Moku Cloud and now trades under the Green Moku Cloud, so the cost is inside the Green Moku Cloud, ensuring the neutral trend of CHZ.

Trading volume (172.64 M) is close to the 20-day moving average (300.86 M). In short, the low volume of transactions caused the price to get rejected at the resistance zone. Investors may also notice that the volume bar on the chart is declining, which indicates that surprising volatility is expected in the next trading days.

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The Stochastic RSI (bearish) with a value of K-33 D-55 presents a sell signal in the coin. Investors may observe a declining slant and a negative crossover in the index. It may remain in negative territory for future trading sessions.

CHZ Token Oscillators Suggest Bearish Divergence

The price of Chiliz token today is USD 0.32, and the 24-hour trading volume is USD 784,906,802. The cost of CHZ has decreased by 20.10% in the past 24 hours. The circulation of CHZ coins is 5.3 billion, with a total of 8.89 billion. The Stochastic RSI indicator shows a sell sign, and the traders have led to low volume. Technically, the price resides around the support zones and continues in a downtrend. Accordingly, as with the overall market viewpoint, the trend remains bearish for upcoming trading sessions.

Resistance Level: $0.43

Support Level: $0.27

BUZZ-COMMENT-A top could have formed in the dollar

Sept 2 (Reuters) - FX speculative accounts that recently piled into the U.S. dollar seem to have been wrong-footed and could be put under further pressure in coming sessions..

The dollar loitered around multi-week lows on Thursday, pressured by softer-than-expected U.S. labour data as traders awaited a fuller jobs report, which is expected to guide the timing of the Federal Reserve’s pullback in bond buying .

The USD index, which tracks the dollar against six currencies, has formed a bearish harami candlestick pattern in the last two weeks, pointing to a market top and meaning the downside risk is growing.

If the USD index drops and remains below the 92.129 Fibonacci level, a 38.2% retrace of the 89.533 to 93.734 (May to August) rise, that will unmask the 91.634 Fibonacci level, 50% of the same 89.533 to 93.734 gain.

For more click on FXBUZ

Weekly Chart: https://tmsnrt.rs/3yxGAH6

(Martin Miller is a Reuters market analyst. The views expressed are his own)

((martin.miller@thomsonreuters.com))

The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.