Nifty and Bank Nifty Weekly Technical View

Nifty Daily Chart

Nifty Daily Charts are displayed below showing the power of money dumped by FII.Its a stellar rally which Indian brouses are seeing.Valuation are moving towards bubble territory as NIfty P/E is at 25.11.

FII inflow in September 2010, totaled Rs 17,499.43 crore (till 23 September 2010). FIIs had bought equities worth Rs 11,687.50 crore in August 2010. FII inflow in the calendar year 2010, totaled Rs 36994.53 crore (till 23 September 2010).

In Continuation to its upward rally it moved up consecutively higher on the second day of the week also, managed to breach the psychological mark of 6,000, marked its 32 month high. After breaching psychological mark of 6,000 nifty paused for a break, fell slightly, below psychological mark but that was short lived. On the last day of trading week nifty again rose shapely, managed to breach the psychological mark of, 6000 again and close above it comfortably, It gained about 2.26% (133 points) from the last week close.

Nifty Weekly Chart

Technically speaking Nifty is in trending market with an upward bias. In Previous week as stated earlier 5940 should provide good support and same happened,Nifty tested thrice 5940 before moving its head above 6000 region again.

The way Dow closed last Friday we are in for a gap up on Monday and probably will hit a new high.

6030-40 range has been the main resisting point in the previous few weeks and as soon as it breaks we are in for a rise till 6100 as shorts will run for there cover.Nifty is trading above its 05 days exponential moving average  5973 on the daily charts, which is expected to provide it a strong support in short term.

MACD showing positive divergence

RSI is at 77 levels with negative divergence can make a support for downmove.

Nifty Trend Deciding Levels:6030-6050

Resistance @ 6094,6125 and 6170

Support @ 5973,5921 and 5885

Bank Nifty Daily Charts

Bank Nifty is in trading range of 12017 and 12335 on daily charts,Break above this range will move bank nifty to a new high in coming sessions

Resistance @ 12426,12564,12692

Support @ 11987,11910 and 11784