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Daily Technical View on Nifty

* Nifty has witnessed a correction of more than 300 points from the recent swing high of 18887. Support for the Nifty is seen at 18442, which happens to be previous swing high on the daily chart. Resistance for the Nifty is seen at 18730. Primary trend of the Nifty is bullish as Nifty has been holding higher top and higher bottom formation on the daily and weekly charts.

* RSI oscillator on the daily chart has reached overbought zone, but there is no sign of negative divergence is seen on the chart. RSI can remain overbought along with price rise. On the weekly charts ADX has crossed -DI line on the upside, which indicates rising bullish momentum in the Nifty. Positional trend of the Nifty is bullish and every dips should be utilized to go long in the Index.

* On a bigger time frame, Nifty has formed bullish inverted head and shoulder pattern, which projects healthy upside for the Nifty in the medium to long term. Next Targets for Nifty are seen at 19274 and 19962, which happens to be the 78.6% and 100% Fibonacci extension levels, if we consider major swings seen in last 6 months. As far as short term support is concerned, previous swing high placed at 18442 is an important level to watch out for.

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