Kristina Somolyar

Stock Phoenix’s Nifty analysis for the Month of January – 2023

Nifty on Fibonacci

We will study the Nifty movement with the help of Fibonacci numbers. It’s one of the moves important and powerful indicators that will help us to arrive at the Targets for the reversal trend. It’s drawn by arriving at the top and bottom of the movement and it’s drawn to arrive at the next set of support and resistance. The higher the Time Frame, the better the results. Here we have taken the Daily charts to draw the Fibonacci Numbers. The drawing remains the same until we get a new high or new low by Nifty. Numbers 38.2% and 61.8% are considered very crucial in the Fibonacci series.

Nifty Analysis :

Nifty made Life Time high on the 1st of December and from there on it is showing constant decline Nifty has hit the 50% Retracement Levels and had a slight bounce back. On the Last Trading in December, Nifty closed near the 38.20% Retracement Zones and this is a sign of caution. Now our next Analysis gets very simple. If the Nifty breaks the 38.20% Retracement zone on 2nd January, then we can expect a beautiful downside love till the zones of 61.80% Retracement Zones and this is placed at the Levels of 17565.65. And this is the Golden Ration of Fibo and this is the zone we should look for a strong buying zone. However, if these levels also get broken, then one can expect the Index to hit the 100% Retracement zone which is 16747.70.
At the same time if Nifty holds above 18070.15, Then Index will take support from these Levels and makes a strong Reversal and will travel towards Upside on the Levels mentioned in the Fibo Chart.

Levels for the Month of January – 2023

As the Index is standing right at the Important zone – We can arrive at easy Levels on both the Upside as well as Downside.
Upside Levels – 18382.60, 18609.40 and 18887.60 if Nifty holds 38.20% Retracement Levels which is placed at 18070.15.
Downside Levels – 17817.65,17565.15 and 17205.65 if Nifty breaks 38.20% Retracement Levels which is placed at 18070.15.

What are the possibilities of Nifty breaking the low or travelling upside in the Month of January 2023?

Nifty made New Lifetime High in the Month of December and this rally started from 16747.70 Levels to 18887.60. After such a long bull run one can expect a small retracement in Nifty. Nifty closed right near the zone of 38.20% Retracement Levels and it’s very important to watch out for the first-week closing. Index sustaining above these Levels will give way to the bulls and vice versa. And as we head towards the New Year, Now the Market will react towards the Budget and the market will make its move based on the Budget News. So one has to keep the News alert in place and play accordingly.

Even though the Fibonacci numbers are very accurate, the Fibonacci analysis does not tell anything about the timeline to achieving the targets. For the time frame, we have to take the help of the Nifty Option chain. The near-term target can arrive with the help of the Option chain.

Weekly Expiry – 05th of January

Today is the first day of the month and we cannot arrive at the exact target for the Index. However, we can arrive at the overall picture with the help of Option chain writing. Looking at the option chain, we can arrive at the below inference.

Weekly PCR Ratio is showing the sign of Bearishness. We can see a good amount of Resistance is getting built in the zone of 18200 and 18300. Hence these levels will act as crucial resistance for the first-week expiry. At the same time, the support is seen at 18000. On breaking this, the Next support is only at 17800. So the downside levels are more favourable for the 1st week of Expiry. Now we have to see if the Index holds 18070 – On Breaking this, one can expect a decent downfall for additional 200 points. So Overall sentiment for the Opening week of January would be bearish. Stay tuned to Stock Phoenix Telegram Channel for more live updates.

Monthly Expiry

It’s too early to predict Monthly Expiry. The overall PCR ratio suggests Bullish when compare to bearish Sentiment for the first week of expiry. As of now, No Major support or Resistance can arrive from the Monthly Option Chain. We will get more clarity once the first-week expiry gets over.

Immediate Target and resistance

• Upside Targets: 18382, 18609 and 18887 (Above 18070).
• Downside Targets: 17817, 17565 and 17205 (Below 18070).

The News which will Impact Nifty’s Movement

The budget is the Major News which needs to be focused on the Index move for the Month of January. And also the Carona News which is getting in focus for two weeks. Now this will also drive the move of Market. Any small Negative news will trigger a big sell-off below our said levels. One can draw fibo and keep the tab on news counter.

The conclusion from Stock Phoenix

We see the Bearish Sentiment for the Initial days of January and expect one or two downside Levels to get honoured and look for a strong Reversal for the Budget Special move.

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