Nifty Trading Outlook for April 2018

New Financial Year about to start and it is always refreshing to kick start with a unbiased outlook especially when a new derivative series starts. Structurally so far correction in Nifty is a complex wave-like downtrend in the last two months. Feb 2018 index futures lost 4.9% and lost 3.8% during the month of Mar 2018.

Nifty Futures attempted to breach 3 month low (Dec 2017 low – 10052) and the major psychological reference level 10000. Those bearish attempt ends in a failure so far thereby giving emotional cushion to the buyers. When comes to April series supports got built in the band of 10000-10100 zone and not a so easy levels to give up on EOD basis. Breaking those levels on EOD basis indicates a possible retest towards the next major reference 9700 levels.

Nifty Futures Daily Charts

First week of the April series is more likely to create more turbulence as the market awaits RBI policy announcement on 4th April 2018. . Though Nifty is trading around supports levels, a compressed trading activity possibly 10050-10250 band is expected in the next week of trading. Higher timeframe participants are expected to join once a greater clarity emerges post the RBI announcement until then Nifty is more likely to trade in a pure speculative environment.

Trading is expected to remain tough in such speculative zones. A speculative environment is often characterized by higher volatility with sideways environment and at times it could be a boring market where nothing happens productively in traders favor.

From the Market Internals perspective so far last two months of corrective moves looks like a temporary correction in a bull market. So do we see a new highs again? Possibly Yes! downside is limited however the amount of time required to retest new higher levels could be anywhere ranging from 4-6 months period of time. And more possibly this time market could raise in medium term with higher volatility where trading is more likely to be more exiting, fun and dangerous.

Nifty Spot – Yearly Profile

Year to Date price spend more time at 10400. More activity is expected around 10400 and 10600 levels. Its always good to realize that something changed in the market dynamics. we are more likely to face a high volatile roller-coaster bull market and not the way old slowly crawling and charming bull.