Medium Term Trend: ↑UP (Changes to down below 10700)
Yesterday, when Nifty closed at 11300 there were many traders who saw this move as a 'breakout move' from the range. There was no blog update yesterday but we had tweeted in the evening that its not a breakout but market has just reached the upper ceiling of range and if its not crossed then we might go down again.
Selling Emerges yet again: Nifty opened around 11300 levels, made a high of 11330 but couldn't sustain and crashed to 11150 levels. It closed at 11200 with a loss of 100 points.
This is exactly what happened today, Though Nifty opened above 11300 it failed to sustain there and crashed again in the 11100-11200 zone where its been trading for last 5-6 trading sessions. Market is currently frustrating traders and just not interested in moving either way. Option buyers are often big losers in such markets as premiums decay very fast.
For now we continue to maintain (like we have been saying for last few days) that markets are rangebound and till we see a clear breakout its not worth trading on either side. We are seeing negative divergences which are raising a probability of markets falling towards 11K once ( if 11300 is not crossed). Below 11K markets can touch 11750-11700 levels. For now further fall below 11750 is looking highly unlikely but things can and will change as we move further.
Once expiry is out of picture we should be able to get a much clearer picture, till then markets remain in correction mode and falling a little more from here (towards 11K levels) is very much a possibility. Crossing/moving above 11330 levels would indeed be a positive sign and a indication that correction/sideways movement is ending.
Happy Trading!
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