Nifty & Bank Nifty Prediction for Next week with Global Market (07-09-2020 - 11-09-2020).

Nifty/Bank Nifty/Dow Jones/ Nasdaq/Option Chain


Last week Market remain very volatile along with global market specially Dow Jones & Nasdaq and closed below strong support zone of  11370-11350 at 11333. As per SGX Nifty market may open tomorrow Gap Down around 11280-11300, and if that happens than we may see strong downside in market. 

There are many factors at the time which indicates downside in market and limited up side. Look at the factors below.

1.    Volatility Index started moving up. (Negative Point).

2.    India - China Border tension. (Negative Point).

3.    India Become 2nd Country with Highest Corona Virus cases. (Negative Point).

4.    Fall in GDP. (Negative Point).

5.    Selling Pressure from FII/DII. (Negative Point). 

6.    Nifty PE Ratio at All time High at 32.49. (Against the Economical Factor).

And only Positive thing is that market is near all time high and above points are already known in market. That is why we have to be alert while trading or investing. 

GDP Data of India:-

Technically also market is showing some sign of cautious, let's see in chart.

Last week i have posted below chart in my weekly prediction. (You can Check Here.). Where in i have mentioned important level on char and exactly Nifty made a high of 11777 and closed at 11333 last week. 

Let's look at the weekly chart of Nifty for Next week prediction.

Weekly Chart of Nifty-50:-

According to Weekly chart Previous Support line is now acting as Resistance line as far as Nifty sustain below 11400-11350. And if that happens then we may see downside in Nifty towards 11200-11000 in coming week. Fresh buying should be avoided unless Nifty start trading above 11500 and sustain on closing basis. Therefore, next week sell on rise strategy should be initiated. 

Daily Chart of Nifty-50:-

According To Daily chart of Nifty we may see lower levels of 11100 and 10900 as per lower low lower high chart pattern that may emerge if Nifty sustain below 11350-11370. In last week of August'20 market shown some sign of positive breakout above 11500 but that all fail last week and Long bearish candle formed on 31-08-2020 indicating limited up side. For Next week market remain negative and may test the previous swing low of 11100 - 10900.

Option Chain Analysis of Nifty for Expiry on 10-09-2020:-

Option Chain data of Nifty is also indicating the same situation as discussed above that downside of Nifty would be around 11000-11200 where highest put writers are active to play role of support. And on upside strong resistance around 11400-11500 with highest call writing. According to current closing of 11333 put writers of 11400 & 11500 are trapped with Open Interest of 12 Lac and 9 Lac. If Nifty bounce towards 11400-11450 then these trapped put writers unwind their position and limit the up side.

India VIX:-

Since Last one week volatility index is sustaining above 20 which is not good and therefore we may see volatile session in coming week also with both side movement. 

How To Trade in Nifty for Tomorrow:-

Expecting Gap Down one can short in pullback around 11300-11350  with Stop Loss at 11400 for Target of 11270-11250. 

No Buying for Tomorrow.

And If Nifty fail to give pullback then one can short below 11300 with Stop Loss of 11350 for Target of 11270-11250-11200.

Bank Nifty:-

Bank Nifty also formed a Bearish Candle on weekly chart indicating limited upside with failure of breakout of previous week. In last week of Aug'20 we have seen strong breakout in Bank Nifty and closing above 23500-23400 and in last week it has shown failure of that breakout and closed at 23011. Bank Nifty is also sell on Rise candidate for next week.

Weekly Chart of Bank Nifty:-

On a weekly chart Bank Nifty fail to sustain above 23500 and indicating further downside towards previous swing lows of 22500-22000. If you look at in chart above Bank Nifty took good support around 23000-23500 zone in July'17 &  March'18 and currently exactly at the same level it is struggling. And if fail to sustain above 23500 then level of 23500 become the major resistance for Index in coming session. For Next week Bank Nifty may trade between 23500-22500 zone. Above and below 23500-22500 we may see further move that i will update in coming session.

Option Chain Analysis of Bank Nifty for Expiry of 10-09-2020:-

As per Option chain data strong support in the range of 22500-23000 with highest put writing and strong resistance in the range of 23500-24500. If Bank Nifty fail to sustain above 23500 then we may see addition in Call writing at 23500. Fresh upside can be seen only above 24000. Because above 24000 we may see massive short covering but chances are less looking to currently global situation.

How To Trade in Bank Nifty for Tomorrow:-

One can can short in pullback around 23200-23100 with stop loss of 23500 for target of 23000-22800-22500. 

No fresh buying for tomorrow.

And if fail to give pullback then fresh selling can be initiated below 23000 with Stop Loss of 23300 for Target of 22800-22500.

I have noted interesting data between Nifty and Dow and for that we have to look at the below chart. Monthly & Weekly chart of Nifty and Dow is very similar in nature. 

Dow Jones (Weekly Chart):-

Above is weekly chart of Dow Jones and if you look at the carefully above chart is exactly as Nifty. Nifty also breached long term support line in Last week of Aug'20 and then closed near to trendline last week and same kind of price action we can see in Dow also. Our market is highly dependent on US market moves. Everyday before market open we have to check Dow and at the time of closing also we have to check Dow. And therefore if Dow also fail to sustain above trendline then we may see downside in Dow along with Nifty. 

Nasdaq (Weekly Chart):-

is one of the Index that has outperformed after the Covid-19 and made series of Higher High and Higher Low on weekly basis. Each week we have seen life time high in this index. And technically index has given "V" shape recover. But in last week it has formed longest bearish candle will fall by 3% on weekly chart. I have marked in chart above. Such recovery was unexpected but Index has shocked everyone. 

(The purpose of sharing above charts is just that last week majority of markets have shown some sign of precaution and closed on negative note. Such combination occurs only sometime).

Thank You..
Happy Trading.
"Learn & Earn"...!!

(Disclaimers:- Above is my personal view on market for next week. It is neither Paid service nor tip. Just for educational purpose only. Take your own decision before any trade).


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