NIFTY range gets fat…..

Range of NIFTY for this week stayed almost within the previous week making a visit close to both high and low. Price tests range high and close within. Both daily and weekly charts are continuing their sideways range pattern. Charts show that this tight range pattern is likely to continue for few more weeks unless some disturbing news adds steam and makes it break the bottom. With weekly charts already into a very strong bearish divergence any bullishness from here is likely to fade into a false move, which would suck in weak hands.

The zig-zag pattern on the daily extends on both ends with every new hit, broadening range pattern is not good for trends, it will prolong for a greater period. MACD histogram which is above zero lacks any strength and mostly follows the price. Today's high was close to the top of the range where NIFTY lost strength and gave in to close lower. Bulls seem to have exhausted their energy in managing to pull NIFTY above resistance. 26 stocks in the NIFTY component list is trending today, though it is well above 50% only 5 stocks are in a strong bullish trend, while 2 of them are in a strong bearish trend, the balance of 19 stocks which are trending are tired ones. 24 stocks or 48% of the Index is indecisive and 38% are tired. This is the reason the index is pulled on both sides and global peers are influencing its moves.

Hourly charts which opened into a very strong bullish trend got sick by the time it reached the previous top on the hourly. NIFTY futures just managed to cross previous high, but those who had a close watch on the movement could have seen a knee jerk reaction when NIFTY failed at 5138. It suddenly lost ground and tumbled down but could not manage to reach value zone but, again took off only to be within the days range.

At the time of this writing US markets well within an hour into trade is flat, Europe seems to close with not much gains, and Gold is gaining. All these are indication that something underneath is losing balance. Will they hold on to strength and pull up or give in to bear onslaught. Last Friday it was almost a similar pattern, US markets gave in to a very strong bearishness towards close. Today????

This much for the weekly summary, we will post more of NIFTY's probabilities after US markets close.

Happy weekend.