Indian Stock Market Prediction for the Coming Week | May 13 - 17, 2024

Hello dear friend, in this Indian Stock Market Prediction for the Coming Week blog post, we will try to analyse trends based on technical charts and Open Interest data. We also try to find important support and resistance in Nifty and BankNifty. We will also share the option strategy for weekly income.

So read the post till the end to know what the trading plan could be in the coming week based on the trend and levels.

Indian Stock Market Prediction for the Coming Week i.e. May 13 - 17, 2024

After a good upside rally in the last month, the Indian Stock Market opened flat and we have seen a sharp decline from higher levels in the first week of May expiry.

Seems like people are booking profit in the Indian Stock Market ahead of the general election in India.

Despite this recent fall, Indian Stock Market is still holding its important support levels. Still, we have hope that bulls will dominate the market again.

Now If you look at the overall sentiments, the short-term trend looks negative and cautious atmosphere ahead of the general election outcomes.

So I suggest we should keep our positions with proper hedges and keep only fundamentally strong stocks in our portfolio.

• Check this also: TradePik's Premium Intraday Option Strategies

Indian Stock Market Prediction Based on the chart

• If you look at the Nifty chart, you can see that Nifty has faced resistance around 22800 two times and has tried to form an "M" pattern while taking support near 21800 -22000.
• Now if Nifty manages to give a breakdown from the 21800 - 22000 zone then it will trigger a short signal that would bring some serious selling in Nifty.
• So important zone to watch for the coming session is: 21800 - 22000.
• BankNifty has also supported Nifty in the last week and heading towards its important support zone i.e. 47000 - 47300. If manage to sustain above this level then we may see some recovery from lower levels.
• A breakdown will trigger a sell signal in BankNifty after a sustainable breakdown from the said zone.

Now after looking at chart, we can say that short term trend looks bearish in Nifty and BankNifty and let it break it's important support zones for further downside levels.

Based on the short-term trends, we can create a mild bullish strategy in Nifty and BankNifty. While keeping limited risk on the downside.

Keep one thing in mind while creating your option strategies both the indices trading near support or resistance levels. Keep yourself prepared for some consolidation or reversal. So choose your strategy wisely.

Indian Stock Market Prediction based on Open Interest data

• For Nifty: 21600 is acting as strong support with a PCR at 10 and resistance is at 22500 with a PCR at 0.36. Max pain is at 22000.
• For BankNifty: 47000 is acting as immediate support with PCR at 6.46 and 48000 as immediate resistance with PCR at 0.39. Max pain is at 47500.
• Expiry Range:
  • For Nifty = 21600 - 22300.
  • For BankNifty = 47000 - 48000 ( based on current OI data. Keep following change in OI for further levels)

The intraday trend was “Bearish” in Nifty and "Neutral" in BankNifty today. (based on our trend-following sheet and setup)

Weekly Options Strategies in Nifty and BankNifty for the coming week

If you look at the option chain, you will find that premiums are very high. Do you know the reason?

The reason is: High Implied Volatility.

You can see India VIX has raised almost 40% in the last week. High IV brought the opportunity to create credit spreads. These credit spreads not only manage the high price fluctuation due to volatility but also help us to generate stress-free returns from the market.

• If you don't know how to use IV to make money from options, then Option Strategies: A Mentorship Program is the best source to learn.

Although the trend looks bearish and Nifty and BankNifty both are trading near to important support zones, I suggest we should create a neutral strategy while keeping risk on the limited side:

• For Banknifty, We can create an iron butterfly while keeping 47500 as the max pain.
• We can sell 47500 CE and PE and we can buy 48200 CE and 46800 PE, based on the current data.

One thing you should keep in mind is that the above trades are based on the current data and need some adjustments if data changes. So proper knowledge and understanding are required before taking entry into any position.

If you don't know how to create and manage these option strategies, Option Strategies: A Mentorship Program would be the best online course for option trading.

I have also shared my Intraday strategies and trend-following trading setup in the above course. You can click on the above button to get access to the course.

DISCLAIMER: We are not SEBI research analysts. Views and trading strategies are posted in this blog post, only for educational purposes. There is no liability whatsoever for any loss arising from the use of this product or its contents. This product is not a recommendation to buy or sell, but rather a guideline for interpreting specified analysis methods. This information should only be used by investors and traders aware of the risk inherent in securities trading.