Skip to main content

NIFTY: Test of 200 Days SMA Might Result in Profit Taking

Nifty spot has successfully tested its flip resistance near 8000 and witnessed nice selling pressure after hitting intra-day high of 7978.45 and settled at 7912.05. Prices are facing resistance near 200 days SMA and 50% correction level of entire bearish attempt from top of 9119.20 to low of 6825.80. Nifty has been witnessing a consolidation in a small range from last 3 days that marks possibility of a bearish breakaway candlestick pattern which consists 5 candlesticks. We need 1 more candle to confirm completion of this pattern. MACD has been staying bullish territory but historical movement on this indicator hints overbought reading and might bring a reversal in this counter.  14 periods daily RSI is also around 67% and remains favourable for bears as long as RSI zone shift takes place. In this set-up we are using 2 moving average system to determine long term trend but short term ( 50 days) moving average is below long term (200 days) moving average that suggests a clear down trend. 
Immediate resistance is now seen near 8000 zones. However, retest to these levels can’t be ruled out but we need stability above 8000 to confirm a move towards 8400-8600 zones. Stability below 8000 will remain favorable for bears and primary profit booking might take this index towards 7700-7550 zones. Areas of 7450 are supported by up sloping 50 days SMA and a temporary bounce can’t be ruled out from those levels in case if nifty fails to hold 7700.  
Labels:

Comments

Post a Comment

Popular posts from this blog

Will Exhaustion Gap Halt the Down Trend in Nifty?

In this video we have explained what NIFTY is likely to do in next few sessions. 
Post a Comment
Read more

Nifty Options Weekly Expiry; MAX PAIN stands at 13400

#NIFTY #INDEX currently trading at 13438, down by 90 from previous close. Today index has opened gap down and taken out the low placed yesterday at 13449 triggering primary weakness in market for the day. Immediate support is now placed at 13390, retest to this level can’t be ruled out but stability below 13390 will result in to further weakness and then attempt towards 13350-13310 zones can’t be ruled out. Key support will be at 13300 and further stability below that level will bring more weakness. Resistance is now placed at day high which stands at 13488, any sustained move (Less likely) above that level will bring some relief to bulls and then attempt towards 13540-13590 can be seen.  On #option_chain heavy #call_writing is being done at 13500-13600 strikes where as short covering is visible in 13450 and 13500 puts whereas longs build up seen in 13400 puts with high volume. Based on current #OI position level of #option_pain stands at 13400 thus based on current data at 10:52AM...
Post a Comment
Read more

Will Gold be Cheaper or Sky Rocket till Diwali?

  Gold spot international currently trading at $1916 up by $15. Gold has been staying within the range formed on August 11, 2020 by a strong bearish bar. It has found multiple supports near the areas of $1870-1860 which is also stands near the low headed by that bearish bar as discussed above. This entire consolidation within the range of bearish bar has taken shape of a descending triangle and now price has climbed above resistance line of this tringle suggesting bullish potential. Price had been staying below 35 days SMA since its bearish cross below SMA during month of August this year but now it has crossed above the same and formed a complete bar above the moving average suggesting bullish developments on MA crossover front. Based on current developments on chart gold is likely to remain bullish as long as it holds above $1885 and having a strong resistance placed near the areas of $1930-1935 zones. Sustained move above $1935 will further strengthen bullish outlook and then it...
2 comments
Read more