Nifty trend analysis for May 2017 -Simplified analysis for Traders
Get trade ready with Nifty trend analysis for May 2017.
Nifty has made new highs in the month of April and market is bullish on uptrend continuation in the month of May.
Nifty Trend April 2017 Summary:
- Nifty made an all time high of 9367.
- Nifty Bank also made all time high of 22383
- Large Cap companies such as Axis Bank, Kodak Bank, Federal Bank, Reliance, Maruti, declared positive above expectations Quarterly results leading to a positive rally in the market.
Global Events to watch out in May:
- FED monetary policy announcement due on Wednesday.
- 2nd round of Presidential election in France on 7 May
- Euro-zone flash Q1 GDP due Wednesday.
TECHNICALS FOR NIFTY TREND ANALYSIS
Nifty Trend Analysis – Daily Chart(Fibonacci Extension) – Support Levels
Support 1 – 9291, Support 2 – 9244, Support 3 – 9168
As per Support levels, Nifty is holding above S1 levels. If it breaks these levels, we may see Nifty around 9250 levels in the next few trading sessions
Nifty Trend Analysis – Daily Chart: (Fibonacci Extension) – Resistance Levels
Resistance 1 – 9233, R2 – 9330, R3 – 9488
On the upper levels, we see that Nifty has already broken R1 at 9230 levels. This shows that Nifty uptrend is likely to try to break new resistance levels provided the market remains optimistic in regards to the current uptrend.
Nifty Trend Analysis – Bollinger Bands (30 Day Interval, SD 2)
Bollinger band levels is at above moving 30 day average. As long as these level is maintained, we can be on the Buy side. Keep strict watch over these levels.
Nifty Trend Analysis – India VIX vs Nifty Chart
As per chart, VIX levels at 10.26 is at its lowest, suggesting a low volatile market thus indicating continuation of current trend.
Nifty Trend Analysis – FII vs DII Chart
In the month of April, FIIs sold 6627 Cr and DIIs bought 9247 Cr. Though it suggests cautionary approach, DIIs have strongly bought into the market and may only be a case of FIIs taking some profit off the table.
It is still an important parameter to keep in your watch list.
- Nifty PE ratio is currently at around 23 and many analyst have started to advice Investors to take out their positions and be on the sidelines. But high PE ratio does not necessarily indicate overvaluation. If further earnings are better with the forthcoming quarterly results of remaining companies, it will adjust its valuation automatically.
- Current trend likely to continue for a longer timeframe unless we have some unexpected disastrous global or domestic event in the foreseeable future.
PERSONAL TRADING VIEWS AND POSITIONS
My personal view for Nifty trend in May is continuation of current uptrend with minor corrections. The probability of any corrections likely to be bought in is high.
Globally, the current downside risks can be triggered by a war like situation.
No major triggers for the markets for sharp movements in either direction. Markets likely to be range bound between 9250-9400 levels
No doubt there is a level of greed creeping into the market but as traders, we should not be very worried about fundamentals and emotions in the market.
Focus on trading the trend as per your technical analysis.
#My current open position (As on 28 April 2017):
- Shorted/Write Nifty 9200 Put @ Rs 52 (Position opened on 28 April 2017)
- Premium received – Rs 3900 per lot
- Margin blocked – Rs 46000 per lot (I use Zerodha margin)
Shorted/Write additional 1 Lot of NIFTY 9200 PE @ INR 65 (As on 2 May 2017)
- Premium received – INR 4875
- Margin blocked – INR 46000 per lot
Total New Position:
NIFTY 9200 PUT – 2 LOTS
Total Margin received in Trading account = (3900 + 4875) = INR 8775
Average premium received per lot = INR 4387.50 (INR 58 per unit)
Total Margin Blocked = INR 92000 (INR 46000 per Lot) (I use Zerodha margin)
Closed positions on 16 MAY 2016 – 2 Lot of NIFTY 9200 PE @ INR 7
- Profit per Lot – INR 3825
- Total Profit – INR 7650
Total Margin Capital : INR 92000 (INR 46000 per lot)
Total Profit (In %age) = 8.31% (In 16 Days)
- Any adjustment I make to my trading positions will be updated here as soon as possible
- If you are interested in real time updates, kindly join my Telegram channel “@fatshubcall“ or“@niftygreeks“. It’s a free channel to share calls of many experienced traders as well as receive updates on market outlook and other related information.
- Alternately you can also leave your details below and I will add you.
- We are not Intra day traders. We only take positional trades.
DISCLAIMER : Please do not trade the Nifty trend only on the basis my personal views here. Make sure you do your own research and please use proper risk management.