Nifty Technical Analysis: Outlook and Trend for 05th Oct 2020

Medium Term Trend:  ⇊Down (Changes to UP above 11500)

Nifty Exhibiting strength:  After falling to 10800 levels, Nifty has shown remarkable strength and pulled above 11400 levels in matter of 5 trading sessions ( which is 100+ gain every trading session).

In Previous post we had mentioned "In next few sessions Nifty needs to make a move above 11275-11325 levels (which was the previous breakdown point) to have realistic chances of resuming uptrend"

Nifty touched 11300 levels couple of days back but spent some time consolidating around it which suggests that it was indeed a crucial level. 11300 was the previous breakdown zone and Nifty had crashed to 10800 levels once this was broken few days back. Now Nifty has managed to scale above it which is a very positive sign for the markets. However, Nifty still has final hurdle to cross which is now sitting at 11500-520 levels. If Nifty manages to make a move above it then it will put markets firmly on the bullish track.

Nifty has put on 600+ points in a matter of days hence some consolidation or some correction cannot be ruled out. However any such correction (arising before nifty manages to make a move above 11500) shouldn't go much beyond 11150 -11200 levels. If Nifty continues to move up and crosses 11500 then 11250-11300 should be the intermediary support zone for markets.

Markets are exhibiting strong bullish character and indicating that it might make a strong move on the upside if certain conditions are fulfilled but of course markets are dynamic and things can change just in one trading session and when it does, we have to change as well. From trading perspective, we had created short positions at 11320 levels which were exited around 11050. If some one is still holding short positions then just above 11500 should be the final SL (closing basis)

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