Nifty opened on a positive note and traded with extreme volatality throughout the session - Axis Securities
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Nifty
Nifty opened on a positive note and traded with extreme volatality throughout the session. Nifty closed at 17362 with a loss of 16 points.
On the daily chart the index has formed a bearish candle with either side long shadows indicating extreme volatility at higher levels. The index is moving in a Higher Top and Higher Bottom formation on the daily chart indicating sustained up trend. The chart pattern suggests that if Nifty crosses and sustains above 17400 level it would witness buying which would lead the index towards 17500-17600 levels. However if index breaks below 17350 level it would witness selling which would take the index towards 17300-17230. Nifty is trading above its 20 day SMA which indicates positive bias in the short term. Nifty continues to remain in an uptrend in the medium and long term, so buying on dips continues to be our preferred strategy.
The daily strength indicator RSI is moving upwards and is above its reference line indicating positive bias.
The trend deciding level for the day is 17360. If NIFTY trades above this level then we may witness a further rally up to 17435-17510-17585 levels. However, if NIFTY trades below 17360 levels then we may see some profit booking initiating in the market, which may correct up to 17285-17210-17140 levels.
Banknifty
Banknifty opened with a downward gap and traded with extreme volatility on either side to close on flat note. Banknifty closed at 36469 with a loss of 124 points.
On the daily chart the index has formed a bearish candle with either side long shadows indicating extreme volatility at higher levels. The index is moving in a Higher Top and Higher Bottom formation on the daily chart indicating sustained up trend. The chart pattern suggests that if Banknifty crosses and sustains above 36600 level it would witness buying which would lead the index towards 36800-37000 levels. However if index breaks below 36300 level it would witness selling which would take the index towards 36100-35800. Banknifty is trading above 20 and 50 day SMA's indicating positive bias in the short to medium term. Banknifty continues to remain in an uptrend in the medium and long term, so buying on dips continues to be our preferred strategy.
The daily strength indicator RSI has turned negative from the overbought territory and is below its reference line indicating sustained downtrend.
The trend deciding level for the day is 36435. If BANK NIFTY trades above this level then we may witness a further rally up to 36720-36970-37255 levels. However, if BANK NIFTY trades below 36435 levels then we may see some profit booking initiating in the market, which may correct up to 36185- 35900-35650 levels.
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