Medium Term Trend: ☝UP (Changes to Down below 11450)
12K Conquered: Nifty opened strong above 12K levels and remained strong throughout the day. It finally closed at 12120 with a solid gain of 200+ points
We had been continuously mentioning in all our previous post that we expect Nifty to move above 12K eventually. We had also mentioned that these 100-200 points fall we are seeing should not be taken seriously ( anyone can go and read my old posts).
There are many who are asking me why markets are rising so much when the results ( Biden victory) are broadly in line with expectations. My answer is simple, markets hate uncertainty and this rally we are seeing is basically a relief rally, Overall trend of Nifty was always up and now markets are relieved that an important event is out of its way and it has resumed its trend. Also there were many traders who were betting on market crash ( seeing the way markets were not able to clear 12K) those traders were forced to close their position too as markets didn't fall much even after election.
Nifty trend was always up and the last 15-20 days fall was a mere correction or a temporary halt. Now its completed and markets have opened another leg on the upside. Correction cycle lasted for 15 days and markets just fell 350-400 points now in last 4 days markets have put up 600+ points. That's how impulsive and trending move play out and from positional trading perspective its always important to trade on the trending side. All this while we refrained from taking short positions and entered long position around 11700 couple of days back (when we saw chances of markets moving up)which has turned out into jackpot trade and has earned good profit for us and our subscribers.
Anyways, going forward there is still plenty of steam left in markets and it can move further up. Todays gap up area ( 11920-12050) will be a very strong support for coming few days. If nifty drops towards this area then one can initiate long position in this zone ( with proper SL ofcourse) on the upside now sky is the limit and markets can go up towards 12400-12500 easily. There is one more domestic event left for Indian markets (Bihar election result) so some volatility can be expected on the day of results or just before that.
Happy Trading
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