Nifty forms Morning Doji Star in the weekly Candlestick Chart

On Friday Nifty 50 Manage to close well above the 7500 mark though the most part of the week was in the high volatile days. Last week Nifty has formed Doji pattern in the candlestick. Dojo was one of the indecisive pattern, this week’s close with big candle body gives clear direction and confidence in the market. With this positive close, Nifty 50 creates Morning Doji Start pattern in the weekly candlestick chart. The Morning Doji Star in one the reliable pattern when it forms in the down trend.

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Finally small and Midcap companies are also giving up

In the year 2015, it was Small & Midcap companies who outperformed the Blue chip companies from Nifty 50 shares. The same happened even with mutual fund companies, where the return from Small & Midcap based funds have outperformed Index based funds.

The Nifty 50 index has closed the year 2015 with negative return of -3.10%. However for the same period Nifty Next 50 and the Nifty Midcap 50 index have given positive return of 9.72% and 3.72% respectively.

Things have changed over the last two weeks trading in 2016. The Small and Midcap companies are going down more than blue chip companies. Year to date, Nifty has given the negative return of 7.69% where as the Small and Midcap index have given negative return of 10.50% & 14.96% respectively. There is a shift in sentiment where the sellers are trying to take money out from profitable trades.

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44% of Nifty 50 shares are trading bearish

In the last two day’s Nifty went down from 7963 levels to 7784 levels. During the last weeks the stocks were trading with thin volume without major market player’s participants. As of last Friday, there were 64% of the Nifty 50 shares were trading positive, 12% of the stocks were in range bound and only 6% of the stocks were in bearish. But as of today there are only 28% of the stocks in bullish and another 28% in range bound and 44% of those are in deep red.

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Nifty closes above 7,900

Bulls have extended its last week strength and took Nifty 50 to close above 7,900. Nifty will reverse the trend in the Three Line Break chart if Nifty closes above 7,955. The MACD & RSI are showing the positive trend reversal in the chart.
In today’s trade Dr Reddy, NTPC, Tata Motors, Sun Pharma and Lupin have turned positive. On the other hand Tata Steel turned bearish.

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