Nifty Analysis: Outlook for 27th Dec 2019

Medium Term Trend:  ↑ UP (Changes to down below 11770)

Expiry Cracks: Nifty saw a steady fall today and it dropped below 12200.and closed at 12125 levels. Down 90 odd points.

We have been saying since last couple of updates that we can see some sort of correction from 12300 levels and we even recommneded unwinding/exiting of long position if 12220-12200 level failed to hold. Today Nifty broke below this range and dropped further 100 points from there.If someone says that technical analysis doesnt work then this should come as an eyeopener to him. It cant get any clearer and accurate than this.

Having said this, (like we have been mentioning) the overall uptrend remains intact for now hence one should not try and short this market as the main trend can resume anytime and trap traders with short position. Till now there is nothing on charts which is suggesting that uptrend has finished and new trend on the downtrend has begun. In all likelihood what we are witnessing is just some sort of correction and nifty should resume its main trend once this correction is over. Still one should wait for this correction to be over and go long only when there is price confirmation on the charts.

Technically speaking 12K level assumes lot of significance now. Ideally we wouldnt like to see a break of 12K levelsand if Nifty does drop towards 12K level and then start moving up then it could be an excellent buying opportunity but it all depends how nifty trades in next few session. Its likely that Nifty reverses from 12100 levels itself. 12101 was the old resistance level so ideally should offer good amount of support.

In Nutshell, 12100 should offer some support and below that 12K level is a very important level to watch out for.In all probability it should hold ( we should wait and watch) If Nifty goes on to break 12K then bear will be back in the game and chances of Nifty dropping down all the way to 11800 levels will increase too. Those who have booked long positions around 12250-300 levels , should sit tight and wait and watch for sometime.

Happy Trading!