Medium Term Trend: ↑UP (Changes to down below 10225)
Exhibiting Super Strength: Nifty continued its relentless march on the upside and touched 10800 levels today and closed at 10760, up 150 points.
Nifty is moving sharply on the upside, in the last update we had maintained a view that Nifty could touch 10800-11000 levels in the current upmove, well the targets are achieved in just one day.
Now moving forward this could be the area ( level around 10850) where we see some pause or consolidation. Markets have run up sharply and are now beginning to enter overbought zone so its not wrong to start expecting some hesitancy at these levels. However it doesnt mean that one should go and short here, absolutely not. Markets have a tendency to overshoot and undershoot its targets so a move towards 11000 and even above is also possible. But at the same time it does make sense to book some of the profits in the long position. In such situations its always better to keep trailing stoplosses.
Looking at charts, in last post we had mentioned levels around 10400-450 for short term SL. Now level around 10600-650 could be used as trailing SL and further weakness in Nifty is possible only if these level breaks till then it wont be wise to expect weakness in Nifty.
Another important change we have done is we have moved the medium term pivot level to 10225 levels. Regular reader of our blog must be aware that last week when markets were falling, we were continuously talking about the important of 10225 level. And even though Nifty broke it intraday, it was always defended on closing basis. Now we feel its a good enough support for medium term and if broken can force the entire trend to 'down'. So be observant and keep a watch on the levels mentioned above.
Happy Trading!
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