Medium Term Trend: ↓ Down (Changes to Up above 11220)
Sharp Pullback: Nifty opened below 10700 levels and created a panic like situation and dropped to 10650 levels however markets made a smart recovery and Nifty rose almost 200 points to 10850 levels. It closed at 10830 up 90 points.
Yesterday we had mentioned that inspite of a massive 200 points decline there is a possibility that markets might try to make a bottom around these area. The way markets have traded today does indicate that probably bottom was done around 10650 for near term. Previously we were saying the same thing when Nifty made a low of 10780 however market decided to make one more low below that but doesn't change the broader picture. Its impossible to predict with pinpoint accuracy the exact low or time when the low is or will be made by the markets so if not 10780 then 10650 is good area to make a bottom too.
We also mentioned that we are reading the fall from 12103 as just a correction which is in its last leg and near completion now it may stretch by 100-200 points or by 5-6 trading days ( again difficult to predict the exact point) but we can see with reasonable surety that probably its near maturity now. The way markets have behaved today raises a strong probability that bottom was made today for near term ( we should get a clear indication in next 2-3 days).
We also mentioned how daily RSI was not supporting this down move and even the time cyle wise the down move is living on borrowed time. Weekly RSI is hovering around 33-34 ( a level which is rarely seen and that too around major bottom levels).
FM has come out with a stimulus package for the markets and most probably markets will open with a gapup on Monday and if the gapup is sustained and markets go on to cross 11100 then the chances of 10650 being the near term bottom will increase further.
If our chart reading is correct and the overeall pattern is developing the way we are seeing then I would like stick my neck out and say ( with full responsibility) that there is a strong chance of markets seeing a minimum 1500-2000 point rally from the low it made today. Ofcourse it will take time ( could be 2-4 months or more) but there is a strong possibility that we will see higher ( read much higher levels) levels than where we are today. Sentiments on the street might be negative and most people are bearish right now but we don't see any major fall commencing from these levels.
Happy Trading!
Sharp Pullback: Nifty opened below 10700 levels and created a panic like situation and dropped to 10650 levels however markets made a smart recovery and Nifty rose almost 200 points to 10850 levels. It closed at 10830 up 90 points.
Yesterday we had mentioned that inspite of a massive 200 points decline there is a possibility that markets might try to make a bottom around these area. The way markets have traded today does indicate that probably bottom was done around 10650 for near term. Previously we were saying the same thing when Nifty made a low of 10780 however market decided to make one more low below that but doesn't change the broader picture. Its impossible to predict with pinpoint accuracy the exact low or time when the low is or will be made by the markets so if not 10780 then 10650 is good area to make a bottom too.
We also mentioned that we are reading the fall from 12103 as just a correction which is in its last leg and near completion now it may stretch by 100-200 points or by 5-6 trading days ( again difficult to predict the exact point) but we can see with reasonable surety that probably its near maturity now. The way markets have behaved today raises a strong probability that bottom was made today for near term ( we should get a clear indication in next 2-3 days).
We also mentioned how daily RSI was not supporting this down move and even the time cyle wise the down move is living on borrowed time. Weekly RSI is hovering around 33-34 ( a level which is rarely seen and that too around major bottom levels).
FM has come out with a stimulus package for the markets and most probably markets will open with a gapup on Monday and if the gapup is sustained and markets go on to cross 11100 then the chances of 10650 being the near term bottom will increase further.
If our chart reading is correct and the overeall pattern is developing the way we are seeing then I would like stick my neck out and say ( with full responsibility) that there is a strong chance of markets seeing a minimum 1500-2000 point rally from the low it made today. Ofcourse it will take time ( could be 2-4 months or more) but there is a strong possibility that we will see higher ( read much higher levels) levels than where we are today. Sentiments on the street might be negative and most people are bearish right now but we don't see any major fall commencing from these levels.
Happy Trading!
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