Nifty Technical Analysis: Outlook and Trend for 06th Aug 2020

Medium Term Trend: (Changes to down below 10750)

Surrendered its Gains: Nifty opened strong nearly 100 points+ at 11200 levels but couldn't sustain its gains and gave up all the gains to close flat at 11100 levels.

Since last few days we have been mentioning about the fact that market is in correction mode hence it makes sense to book profits once at these levels. Yesterday evening we had posted on twitter that if we do not see follow up buying and fail to move above 10175-10200 levels then markets can go down again.

Many traders would have gone long today thinking the correction is over and Nifty is all set for new high above 11300 levels. Well markets again went down leaving everyone confused.

As far as our view is concerned, its clear that even though overall trend is up ( as long as 10750 holds), for short term perspective markets are still in correction mode. Going long makes sense only once we get clear sign of this correction ending.Way markets have tumbled from 11200 levels is only lending more credibility to our view.

We need to see a strong move above 11200 levels in next 2 trading sessions followed up with a move above 11370 levels. That will confirm that correction is over and markets are heading towards 11700-800 levels, till that happens, the chances of markets falling again  towards 10800 or lower ( if 10750 breaks) remains hence one should continue to remain watchfull.

From trading perspective, long positions are recommneded only above 11200 levels (that too light qty) and on the downside if 11020-30 level breaks then we can fall towards 10900 and retest recent low pretty soon. Keep these levels in mind before Taking any trading call.

Happy Trading!

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Nifty Technical Analysis: Outlook and Trend for 04th Aug 2020

Medium Term Trend: (Changes to down below 10750)

Weakness Surfaces: Nifty tumbled today, it opened weak around 11K levels and kept pushing down. Finally closed below 10900 levels , with a loss of around 180 points.

In last few posts we have continuously been saying that Nifty might start some sort of correction from 10200-10300 levels and it makes sense to book profit once at these levels. We have been advising against going long at these prices. In last post (Thursday) we had mentioned that:

"There exists some good support at 11050-25 level and market could try and test it tomorrow. If it holds then markets can move up again however if it breaks down then we can see some more weakness in near term"

Market tested 11050 support on Friday (bounced exactly from 11025 levels), however there was no further follow up buying and it broke the crucial support today and as a result slipped further in bearish territory. Even though 11025 level held, the way markets were trading did indicate that its likely to break this support on Monday and that's how exactly happened.

Now moving forward, we need to see Nifty make a strong move above 11125 levels, till that happens, we can continue to see weakness in Markets. Next support (major) for Nifty is around 10750-10800 levels and we need to see if markets are breaking or taking support at these levels. Holding these level and then moving back above 11K levels could signify returns of the bulls however if these levels gets broken as well (on closing basis) then the ongoing correction could deepen further and we might go down to 10500-10300 levels.

In Nutshell, markets continue to remain in correction mode and now has corrected almost 400 points in last 2-3 trading sessions ( 11300 to 10900). If the final support at 10750-10800 zone fails to hold then this downmove might get extended further as it could indicate an extended correction ( both price wise and time wise)

Happy Trading!

To Join our Nifty algo buy/sell whatsapp message service during market hours, pls click⤇ Nifty Buy/Sell Algorithm  or whatsapp @ 9319321906 

To see our recent trading calls for Nifty Algo- Pls click ⤇  Past Trade summary