[Premium] Three Charts For The Week Ahead

Last week we focused on Nifty Auto Index, Nifty PSE Index and the US Dollar Index

Let's move into this week's topics.

1.  The first chart that grabbed our attention this week was Nifty FMCG. The index breached its resistance and has closed decisively above it. RSI is in the overbought region signaling bullish momentum. Looks like the market is ready for FMCG's participation going forward.

Nifty FMCG joining the market rally at this stage is a positive for the market. Several big names that had previously remained subdued on account of the sector trading sideways are now participating, which is good for the sector and broader market from an intermediate/long-term perspective.

Click on chart to enlarge view.

On that note let's also take a quick peek at the popular laggard which has the second-highest weightage in the FMCG sector-ITC.

ITC has breached its 2020 resistance at 205 in its fourth attempt, and we're positive above this level for a target of 235. Momentum has turned bullish with the RSI moving into the overbought region as can be seen below.

Market participants have been waiting for a move in this counter for quite some time. We may see that going forward.

2. The second chart we'd like to look at is Nickel. Nickel is taking another run at its long term resistance of 1225, closing above it on a weekly basis. It remains to be seen whether this move can hold its ground or if we will see another failed breakout.

For now, we'd like to keep a watch on this counter as Base Metal performance has a strong positive correlation with the broader Equity indices.

3. The third chart we're looking at is Germany's DAX. As Europe's indices signal bearish divergence over the short term, DAX has halted at its resistance of 13500 for the fourth time now. With broader market indices taking a breather, the thematic rotation continues to play out.

Will the DAX turn away from this level again or make another attempt of breaching this zone? Presently, the indicators don't allude to a strong bullish move in the short/intermediate-term, but longer-term the chart remains constructive and we'd expect an eventual upside breakout.

In our view, these charts will help set the tone for this week and provide us information on how we should approach the market in the coming weeks.

Also, make sure to check out our other weekly post, "Trade Of The Week."

Thanks for reading and please let us know if you have any questions.

Allstarcharts Team