Monday, February 10, 2020

Nifty Analysis: Outlook and Trend for 11th Feb 2020

Medium Term Trend: Down (Changes to up above 12175)

Nifty Turns Cautious: Nifty opened weak today around 12050 levels and went on to test 12K levels quite a few times intraday. It finally closed at 12030 levels down 70 points.

In last few updates we have been mentioning that Nifty has good resistance in 12100 zone and inspite of a strong rally of 500+ points from the lows of 11600 levels we maintained the trend as 'down' only ( revised the reversal level to 12100 and then finally to 12175).

Today we did see some weakness in Nifty and one stage market was down 100+ points however followup buying at lower levels prevented any major fall and market closed with just a small loss of 65 odd points. Like we have been saying, the bounce which has come form 11600 levels is a 'V' shaped recovery and there is a chance that this V shaped recoveries is driven by sentiments and greed rather than actual buying. Sentiments and greed can pull markets till at a point only after that the upmove can be stretched further only by real buying and we are yet to observe if real or followup buying is indeed emerging at these levels.

In last 2 days we have seen a fall of about 150+ points and last Friday Nifty had made a 'bearish belt hold patter' which we suggested was a bearish pattern provided we see followup selling below the low point of the day. Today we saw exactly that, Nifty opened below fridays low and whole day traded below that only.This again can have some more negative implications gong forward.

Going forward, for positive scenario to emerge, Nifty should defend 11850-11950 range. If nifty can consolidate and create a support zone around 11900 levels then we expect it to touch higher levels ( 12500) once again. However in case we see more weakness from here and Nifty goes on to break levels as mentioned above, then we can see a retest of old lows @ 11600.

In summary, inspite of a 500+ rally in last few days market is not out of the woods completely there is still a possibility of Nifty retesting 11600 levels. For a positive scenario to emerge market must protect 11850 levels and then break above 12175 levels to resume uptrend.


Happy Trading!! 



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