Medium Term Trend: ↓ Down (Changes to Up above 11365)
Weakness Again: Nifty opened flat but after trading around 10950 level for entire day it dropped below 10900 levels towards the end touched 10850. It closed down 90 points @ 10855.
Markets have been in a downward trajectory ever since it broke below 10985 levels and since then every rise is attracting selling. However on short term charts markets are appearing a tad oversold hence a bout of short covering can not be ruled out. 10800-850 is the area from where we can expect a bounce however further weakness below this level can push Nifty all the way to 10600 levels.
Since the day Nifty closed below 10985 levels, the long term trend turned down and most likely Nifty is headed towards 10600 which was the starting point of this entire rally ( 10583 to 12103). If Nifty can manage to protect 10800 zone and break above 11100 levels then positive options open again but till that happens, Nifty is in danger of testing 10600 and 10200 below that.
Overall looking at the entire rally, we believe that this upmove started from 10583 and went all the way till 12103 (1500 points). Now 75% of retracement level of this entire upmove comes to around 10975 which is already broken. Now usually an impulsive move doesn't get retraced by more than 61.8%-75% but exceptionally even 85-90% retracement level is possible which gives a level of 11750-11800 ( even these levels have been tested already). Incase market respect 10800 levels then we can hope for a short term bounce ( how far the bounce goes is a different matter altogether) but if 10800 breaks then we are most probably headed towards 100% retracement of entire rise which could open up further downside targets.
For now global markets have been working against Nifty ( but Nifty was falling when global markets were rising so can we expect the opposite now?) and at time of writing this post Dow future is more than 400 points down. It remains to be seen whether Nifty takes this fall in its stride and show some strength over 10850 levels (in which case we can expect to see higher levels) or it caves in (which could then mean a strong possibility of Nifty testing 10600 levels).
Happy Trading
Weakness Again: Nifty opened flat but after trading around 10950 level for entire day it dropped below 10900 levels towards the end touched 10850. It closed down 90 points @ 10855.
Markets have been in a downward trajectory ever since it broke below 10985 levels and since then every rise is attracting selling. However on short term charts markets are appearing a tad oversold hence a bout of short covering can not be ruled out. 10800-850 is the area from where we can expect a bounce however further weakness below this level can push Nifty all the way to 10600 levels.
Since the day Nifty closed below 10985 levels, the long term trend turned down and most likely Nifty is headed towards 10600 which was the starting point of this entire rally ( 10583 to 12103). If Nifty can manage to protect 10800 zone and break above 11100 levels then positive options open again but till that happens, Nifty is in danger of testing 10600 and 10200 below that.
Overall looking at the entire rally, we believe that this upmove started from 10583 and went all the way till 12103 (1500 points). Now 75% of retracement level of this entire upmove comes to around 10975 which is already broken. Now usually an impulsive move doesn't get retraced by more than 61.8%-75% but exceptionally even 85-90% retracement level is possible which gives a level of 11750-11800 ( even these levels have been tested already). Incase market respect 10800 levels then we can hope for a short term bounce ( how far the bounce goes is a different matter altogether) but if 10800 breaks then we are most probably headed towards 100% retracement of entire rise which could open up further downside targets.
For now global markets have been working against Nifty ( but Nifty was falling when global markets were rising so can we expect the opposite now?) and at time of writing this post Dow future is more than 400 points down. It remains to be seen whether Nifty takes this fall in its stride and show some strength over 10850 levels (in which case we can expect to see higher levels) or it caves in (which could then mean a strong possibility of Nifty testing 10600 levels).
Happy Trading
No comments:
Post a Comment