Medium Term Trend: ↓Down (Changes to up above 11850)
Corona scare : Nifty had another bad day and after opening strong at 11400 levels it fell to 11040 levels ( almost 350+ points from day high). It recovered slightly to close at 11130 levels, down 70 points.
Morning session promised a lot and Nifty opened and traded around 11400 levels for quite some time however like we had mentioned in our previous post, we needed to see if its showing strength in the gapzone of 11350-11450 or not. Nifty, though opened strong, failed to move above the gapzone and the rest was done by news flow coming in which confirmed fresh cases of corona virus in India.
Overall Nifty continue to trade in bearish zone but the levels around 10950-11000 assumes a lot of significance from near term perspective. Markets are oversold and technically due for a good bounce and this area could be a good zone from Nifty can bounce back in near term. Todays sharp pull back from 11400 levels is looking like a panic selloff and sometimes (usually often) we see market forming a base around the sell off zone. Now we are not saying that bottom is done but all we are saying is that market never moves in one direction and if a bounce back is due then this zone ( around 11k) is a good area for that hence some low qty buy can be initiated at these levels.
One interesting observation is that market is following a 10-11 days time cycle for rallies and drops. Previous drop from 12400 levels to 11600 had consumed around 11 days. Now today , the fall which started from 12250 levels has consumed 11 days. if one looks at Fibonacci levels then the current fall is around 150% level of the previous fall.
In Nutshell, we need to see if market is taking support at 11100 levels and if it does then we can see another move towards 11400 levels and if Nifty moves above 11450-500 levels and covers the entire gap that will be first indication that probably some sort of bottom is in the place. Till we see that, the trend remains on the downside but risky and smart traders can try and buy around 11K-11100 zone ( todays low) if they get an opportunity with a SL of around 10940.
Happy Trading!
Corona scare : Nifty had another bad day and after opening strong at 11400 levels it fell to 11040 levels ( almost 350+ points from day high). It recovered slightly to close at 11130 levels, down 70 points.
Morning session promised a lot and Nifty opened and traded around 11400 levels for quite some time however like we had mentioned in our previous post, we needed to see if its showing strength in the gapzone of 11350-11450 or not. Nifty, though opened strong, failed to move above the gapzone and the rest was done by news flow coming in which confirmed fresh cases of corona virus in India.
Overall Nifty continue to trade in bearish zone but the levels around 10950-11000 assumes a lot of significance from near term perspective. Markets are oversold and technically due for a good bounce and this area could be a good zone from Nifty can bounce back in near term. Todays sharp pull back from 11400 levels is looking like a panic selloff and sometimes (usually often) we see market forming a base around the sell off zone. Now we are not saying that bottom is done but all we are saying is that market never moves in one direction and if a bounce back is due then this zone ( around 11k) is a good area for that hence some low qty buy can be initiated at these levels.
One interesting observation is that market is following a 10-11 days time cycle for rallies and drops. Previous drop from 12400 levels to 11600 had consumed around 11 days. Now today , the fall which started from 12250 levels has consumed 11 days. if one looks at Fibonacci levels then the current fall is around 150% level of the previous fall.
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| Nifty |
In Nutshell, we need to see if market is taking support at 11100 levels and if it does then we can see another move towards 11400 levels and if Nifty moves above 11450-500 levels and covers the entire gap that will be first indication that probably some sort of bottom is in the place. Till we see that, the trend remains on the downside but risky and smart traders can try and buy around 11K-11100 zone ( todays low) if they get an opportunity with a SL of around 10940.
Happy Trading!
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