In this blog, I will apply technical analysis to charts of major indices and share my views on what we can expect in next 1 year.

I will discuss charts of following indices – Nifty, BankNifty, Nifty IT index, USD/INR, Nifty Auto Index, Nifty Smallcap 100 Index.

Nifty

nifty monthly

  • Strong resistance at 11000.
  • Breakout above 11000 may lead to some short term upside. But not expecting it to cross previous highs of 11753.
  • Some down move possible if support of 10800 taken out.
  • Prior uptrend is over on both monthly and weekly timeframes.
  • ADX indicator,which is a good measure of strength of a trend is falling on both weekly and monthly charts.
  • Broad range can be 10000-11753 for many months for the Nifty index.
  • 10000 is strong support zone on monthly charts.
  • Around 10000, we should be very close to the lower end of the long term rising channel for the index, which should give very favorable risk/reward for investing.
  • I would not like to be too pessimistic at this time to give targets of 8000 or 6400 for the Nifty as some others may give. I will only consider them to be a low probability events and will think about that only if Nifty breaks 10000 decisively.
  • I remain optimistic that after maybe 1-2yrs of consolidation, Nifty will again start marching towards 13k-15k.

BankNifty

BN monthly.png

  • ADX indicator falling on both monthly and weekly timeframes indicate lack of trend.
  • MACD Histogram being -ve on monthly charts suggests possibility of decline.
  • Index has broken the lower end of green up-channel (refer chart).
  • Strong resistance close to 28000.
  • A decisive break below 27000 can eventually lead back to 24000.

USD/INR

USDINR monthly

  • USD/INR continues to be in an uptrend on monthly charts.
  • ADX indicator continues to rise higher, even though the currency pair has traded sideways for last 3-4 months.
  • Immediate resistance around 72. Breaking above that can cause swift upmove to 75.
  • Breach of range 11 rupees range of 58 to 69 that held for approx 5 yrs from Aug 2013 to mid-2018 gives upside tgt of 69+11=80 for long term, which may happen possibly in 2019 or 2020.

NSE Nifty IT Index

cnxit monthly

  • The Tech index remains in a strong uptrend on monthly charts.
  • ADX indicator continues to rise. MACD Histogram remains positive. An extremely bullish setup.
  • Strong support around 15000.
  • Resistance at 16300-16400
  • I believe minor dips towards 15000 can be good buying opportunity in tech stocks.
  • Expecting tech index to hit 19000 in 2019.

NSE Nifty Auto Index

cnx auto monthly

  • Already down 30% from last year’s peak.
  • Fallen to strong support zone of 8000.
  • I believe this can be a good time for contrarian buying in the sector.

NSE Nifty SmallCap 100 Index
smallcap100 index

  • Index is back to where it was 11 years ago in the previous bull market.
  • Breaking critical support level of 6000.
  • Technical target of 4343 from breach of Head & Shoulder reversal pattern b/w 7000 & 9657.
  • So unless it  gets back above 6000, there is significant downside risk even from current levels.
  • I will consider the down move of last 1 year to be over only if index crosses 7000 on the upside.Read Disclaimer Here.