In this newsletter read about how Nifty is trading at crucial level, a make it or break it point.
You must be surprised with the heading of this letter. However one should never forget that markets are run by bulls as well as bears. This time it was turn of bears who welcomed Nifty in 2016 by creating mayhem with a fall of almost 360 points- last week.
I could not write this letter last week due to some unavoidable reasons.
Technical Overview: Last week Nifty made high of 7937 and low of 7556 to close at 7601. A range of 380 points with a huge red candle. Nifty closed near its low. This low is also near earlier bottom of 7540-7550. Nifty is now trading in oversold territory.
Major global markets closed near their weekly low. However they are trading near their earlier lows (support) and are also in oversold territory.
It becomes immensely important for Nifty to hold 7540 for us to believe that bulls are action, at last to some extent. However the big fall in last week forming a big red candle is exhibiting bear power. This power may not diminish soon.
New resistance is formed on Nifty chart near 7720-7800. Barring current support of 7540, Nifty has next support at 7480-7425
My View: If Nifty opens above 7540 on Monday and holds it for the day, we may see some bounce in Nifty, say up to 7720. However after reaching this resistance it can start moving northward again. Or Nifty breaks below 7540 and keeps moving down. In either case Nifty chart is giving me the feeling that it wants to move further down.
Check the influence areas (supports and resistance on chart below)
No comments:
Post a Comment