Nifty Tomorrow: Prediction, outlook and Trend for 22nd Apr 2021

Medium Term Trend: 👈👉Sideways (Changes to up above 15100 & down below 14200)

Nifty @ 14295 down 63 points - Weakness once Again

Last couple of days have brought mayhem in Markets and Nifty has crashed from 14600+ levels to 14200+ levels. Worsening covid cases & the widespread panic was blamed for the sell off. In last few posts we have been discussing that Markets are in sideways mode and have been maintaining that the break out is likely to be seen on the upside.  In the previous post we had mentioned that:

For bearish option to play out we should see a strong reaction on Monday (when we say strong we mean atleast a fall of 150-200 point) followed up by break of 14250 levels in next 3 trading session, anything short of that is not likely to deter bulls.

Unfortunately for bulls thats how it turned out and markets opened with a 200+ gapdown on Monday Even a flat or mildly weak trading session on Monday would have gone a long way in kickstarting the upmove. Frankly speaking we were not expecting such a move and the probability of same was pretty low. However that does not mean that overall view is changed, inspite of the carnage witnessed in last couple of days , the overall view still remains same. Market is in sideways mode and breakout is still likely to come on upside. Reason is simple, market has spent way too much time in this range ( around 40 days or 9 week). Usually no bearish/sideways mode lasts for more than this period. Lets  compare the last 40 days movement with crash we had seen in Feb/Mar last year.

Last year when the crash unfolded it took markets exactly 9 weeks to crash from 12500 levels to 7500 levels. Now market has consumed almost same time but trading just 1000 points from all time low. Point is market does not like to wait (especially for a downside move).If any major fall was possible then it would and should have come by now. In other words, If markets were to go down it would have gone down by now and not waited for cases to increase to 2.5L. What we witnessed was probably just a kneejerk reaction by a section of market participants and once the news is digested its likely to reverse. Remember any move which comes AFTER the news is out does not last for long (news follows market and not other way around).

Having said this, in case we break below 14200 levels ( have shifted the range slightly to 14200-15100) and close (2 consecutive close) then it possible that we see some more fall (towards 13800) but even if that happens that should be just the last leg of this fall expanding on the downside.

In Nutshell, 14200-14300 levels hold the key for short term & if market holds it ( its been holding since last 2 months) and start trading above 14550-600 then it will be a very positive sign and indication that break out is arriving on the other hand if 14200 breaks then we might see some more fall but even then market is not likely to sustain below it for long.

Happy Trading!

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