Thursday, May 7, 2020

Nifty Analysis: Outlook and Trend for 08th May 2020

Medium Term Trend: ↓Down (Changes to up above 9800)

Stuck at 9200: Nifty opened weak below 9200 and continue to trade around this level for most part of the day and even closed at 9200 too, down 60 odd points.

Nothing much has changed since our last update and as mentioned in the last post we continue to observe markets for now.  Right now its too early to conclude if markets have opened a fresh leg on the downside at the same time its also confirmed that one wave of up move has also got over at 9800 levels.

Now we need to see if markets open a fresh wave on the upside or signal start of a fresh down move. 9000-9100 zone ( as mentioned in previous post too) continue to be an important zone and it only got tested briefly yesterday when Nifty dropped to 9120 levels so we cannot rule out another move towards 9000-9100 levels.

On the upside, 9400 now has emerged as strong resistance, the Monday gap down area still stand and Nifty has formed an 'island reversal area' at that level. Nifty continue to hover in between 2 critical support and resistance points hence we continue to remain in 'wait and watch' mode for now.

If Nifty manages to move strongly above 9350-9400 levels and Nifty start filling up the gap down area then there is chance of Nifty testing 9800-10K or even higher levels however if 9000-9100 level breaks then there is a strong possibility of Nifty retesting 8500 or lower levels.

OI in market continues to be extremely light which is suggesting that we may not see sustained down move from these levels. But that's just one of the indicator , as always the most crucial indicator is 'price chart' and same is indicating breakout or breakdown only once the levels mentioned above are taken out.

Happy Trading


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