Stock market technical analysis and trend for next week

Stock market technical analysis and trend for next week published by Angel stock broking and stock market research house. Check it out to decide on your stock market trading strategy for the week starting on March 5th.

Sensex (17637) / Nifty (5359)
Monday's session in last week witnessed strong selling pressure to close significantly lower. Eventually, Indices traded within the range of the Monday's price action throughout the week to close near "20-day EMA". On the sectoral front, Realty, IT and Capital Goods counters contributed heavily in this week's correction, whereas Health Care and PSU sectors ended on a gaining side. The Sensex ended with a loss of 1.60%, whereas Nifty lost 1.29% vis-à-vis the previous week.

Pattern Formation
The 200-day SMA and 20-day EMA have now shifted to 17180 / 5167 and, respectively.

The weekly "Stochastic" oscillator is still negatively poised.

The 61.8% Fibonacci retracement level of the fall 21109 / 6339 (November 5, 2010) to (December 23, 2011) is around 18827 / 5645.

Future Outlook
Broadly speaking, markets are trading in a range of 18001 to 17381 / 5459 to 5268. A breakout from the mentioned trading range, on either side, is likely to dictate a clear direction in coming weeks. Therefore, if indices manage to sustain above the weekly high of 18001 / 5459, then we may witness a positive momentum, which would push indices higher to retest recent swing high of 18524 / 5630. On the downside, level may provide decent support for the markets. A word of caution, the weekly "Stochastic" oscillator is still negatively poised. The impact of this technical tool may come into action on the violation of this week's low of 17381 / 5268 level. In this scenario, selling pressure is likely to intensify further and may drag indices to test "200-day SMA" support zone of 17230-17180/5210 - 5167 level.

Stock traders should take a note that the coming week is likely to witness volatility on account of the results from the UP elections and markets may take clues from the same.