Medium Term Trend: ↑UP (Changes to down below 9000)
Last time when Nifty had closed above 9800 levels (April Expiry day), it was not very convincing ( hence we kept the trend as down only) and markets reversed 500 points the very next day. However this time looks like its done for good. Last time the trend was moved to 'down' was way back in Feb when Nifty broke below 12K levels now after 3.5 months the trend is changed to 'up' again.
There are couple of interesting things which have happened in the markets today. Lets see the daily chart of Nifty to analyze what are those.
1: The previous island reversal area ( 9750-9600) area is closed today. We had been saying all this while so that is not at all surprising however what is surprising is that the bearish "island reversal" area is taken by yet another gap-up turning a bearish 'island reversal' into a bullish 'island reversal' Now I am not sure when was the last time such a powerful bullish pattern ( this indeed could be very powerful) was seen in Indian markets.
2.If you see the entire fall from 9850 levels to 8823 levels had taken Nifty 11 days now the complete fall is retraced in just 9 days. This faster retracement is a classic sign that market is shifting gears and trend is changing and already changed now(though we had predicted he same when Nifty was just at 9k levels). Hence now there shouldn't be any doubt in any ones mind about the direction market is going towards.
Now going forward, we see strong support in 9600-9750 area for Nifty and any fall is likely to be arrested around these levels. Nifty now in all probabilities heading towards 10k+ levels ( mind you pull backs will continue to come from time to time and one need to be careful). 9950-10050 levels used to be the old support levels for Nifty hence some sort of resistance is expected around these levels. Overall mkts are still in slightly overbought zone for short term ( but that doesn't mean its a sell signal).
As far as trading is concerned, we had entered long @ 8950 levels which still continues as of date ( Nifty is up around 1000 points from our entry price)
Last time when Nifty had closed above 9800 levels (April Expiry day), it was not very convincing ( hence we kept the trend as down only) and markets reversed 500 points the very next day. However this time looks like its done for good. Last time the trend was moved to 'down' was way back in Feb when Nifty broke below 12K levels now after 3.5 months the trend is changed to 'up' again.
There are couple of interesting things which have happened in the markets today. Lets see the daily chart of Nifty to analyze what are those.
 |
| Nifty Hourly chart |
1: The previous island reversal area ( 9750-9600) area is closed today. We had been saying all this while so that is not at all surprising however what is surprising is that the bearish "island reversal" area is taken by yet another gap-up turning a bearish 'island reversal' into a bullish 'island reversal' Now I am not sure when was the last time such a powerful bullish pattern ( this indeed could be very powerful) was seen in Indian markets.
2.If you see the entire fall from 9850 levels to 8823 levels had taken Nifty 11 days now the complete fall is retraced in just 9 days. This faster retracement is a classic sign that market is shifting gears and trend is changing and already changed now(though we had predicted he same when Nifty was just at 9k levels). Hence now there shouldn't be any doubt in any ones mind about the direction market is going towards.
Now going forward, we see strong support in 9600-9750 area for Nifty and any fall is likely to be arrested around these levels. Nifty now in all probabilities heading towards 10k+ levels ( mind you pull backs will continue to come from time to time and one need to be careful). 9950-10050 levels used to be the old support levels for Nifty hence some sort of resistance is expected around these levels. Overall mkts are still in slightly overbought zone for short term ( but that doesn't mean its a sell signal).
As far as trading is concerned, we had entered long @ 8950 levels which still continues as of date ( Nifty is up around 1000 points from our entry price)
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Happy Trading
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