Nifty Technical Analysis: Outlook and Trend for 9th Sep 2020

Medium Term Trend:  ↑UP (Changes to down below 11275)

Failed to move above 11450: Nifty today opened flattish but soon moved above 11400 levels. It continued to trade between 11400-440 but failed to move above it and crash towards 11300 in the end.

In the last post we had mentioned "its highly likely that market near term trend has changed down but we would like to see a close below 11275 levels just to be totally sure"

Now its been two trading sessions and even though Nifty has managed to protect 11275 on closing basis, it has failed to move up and any sizeable rally has not been seen and today it has again closed almost at support level. Thing about strong support/resistance levels is that they shouldnt be tested again and again and markets should ideally just kiss them and move away.

The way Nifty is trading since last few days is clearly giving indications that markets are probably tired and don't want to move up immediately and probably wants to correct a bit more from here. 11450 has now emerged as a very very strong resistance for Nifty. Markets had failed to move above 11450 on Friday (it touched 11450 and crashed to 11300). Same is seen today as well, Nifty touched 11440 levels and crashed to 11300 levels. All these are indication of weakness and are clear warning signs hence its time to be super cautious. Nifty is not yet done with the correction and can attract more selling from here hence holding long positions without proper SL can prove to be very risky.

So in summary, failure to move above 11450 levels has clearly indicated that for short term, market is in a bearish phase. For medium term too we are tempted to change the trend but will do it once 11275 breaks (which is looking very likely now). Weakness below 11300 could spiral into more selling and push Nifty lower from here (towards 11000) hence be careful. For any bullish scenario to emerge, we need a move above 11550-575 levels pretty soon now.

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