Medium Term Trend: ↑UP (Changes to down below 10650)
Turning Volatile: Nifty is turning volatile near 11200.It opened weak and broke 11100 intraday but picked up again and made a move back towards 11200 levels & closed marginally in red.
Since last couple of updates we have been mentioning about the possibility of Nifty going in some consolidation mode at these levels (before upmove resumes).Looking at markets now, till Nifty makes a strong thrust above 11250-11300 levels, its possible that this consolidation continues for some more time. Only thing we need to see is whether this consolidation finishes in a sideways mode ( wild swings in a ~200 point range like last couple of corrections) or does some price damage as well.
Like we had mentioned in yesterdays post, we were seeing some negative divergences on the charts and today we have seen some price damage too (though it was just intraday and recovered) which is indicating that markets are entering/have already entered correction mode. In case markets fails to move above 11250-11300 levels then it can drop towards 11K levels once. Nifty has good support at 10950-11K levels and any correction should be able to find support around 11K levels. In case markets break below 10950 then we can go all the way to 10700 levels. Any serious correction or trend change is likely only once 10650 is taken out on closing basis.
For now, from trading perspective, it makes sense to be cautious and book profits once and enter fresh longs only after current correction get over (or Nifty move above 11250-11300).
Happy Trading!
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