Medium Term Trend: ↑ UP (Changes to down below 11400)
Nifty today slipped 100+ points to close at 11900 levels. On weekly chart even though it posted a new high, the closing was almost flat.
We have been saying since last few days that even though the near term trend remains up the markets are looking a bit tired and the way markets are trading are giving an impression that its losing momentum slowly. However that doesnt mean that overall trend of the market has turned down, it only means that for near term there could be some sideways correction.
Yesterday Nifty closed above 12K and that must have been good enough to cut stoplosses of many traders who were on short side however today markets again slipped below 12K ( and even 11900).
We had also mentioned that nifty needs a strong close above 11985 levels to signal start of a fresh uptrend. While Nifty closed above 11985 yesterday, it failed to close above it today and the weekly closing has come below 11985 levels as well.
For short term we could continue to witness choppiness and sideways trading and we dont think Nifty could fall much from here however a fall till 11450-11500 is very much possible ( ~400 points from cmp) and as long as 11400 is held the uptrend of the market remains up. A strong close above 12050-12100 would proably mean that sideway correction is over and markets have opend a fresh leg on the upside.
As per our analysis and after seeing the way the markets have traded in last few days it has become clear that markets wants to go higher (much higher from current levels) but the upmove might not come immeidately and nifty can spend a little bit of time (even 1-2 month is a possibility) at these levels. After all we have seen a strong rally of ~1500 points in last 40-45 days so some bit of consolidation is natural and healthy. Whenever this correction gets over markets are likely to open a new leg on the upside, till then trade light and as soon the charts give confirmation, one should go all in.
Trade well Trade wisely.
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