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Nifty

Nifty opened sharply lower with a downward gap and selling pressure for most part of the session led it close near the day's low. Nifty closed at 17491 with a loss of 268 points.

On the daily chart the index has formed a sizable bearish candle and has closed below previous session's low indicating negative bias.The index continues to move in a Lower Top and Lower Bottom formation on the hourly chart indicating negative bias. The chart pattern suggests that if Nifty crosses and sustains above 17600 level it would witness buying which would lead the index towards 17700-17800 levels. However if index breaks below 17450 level it would witness profit booking which would take the index towards 17300-17200. Nifty is trading above its 50 , 100 and 200 day SMA which indicates positive bias in the short term. Nifty continues to remain in an uptrend for the short 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 profit booking.

The trend deciding level for the day is 17550. If NIFTY trades above this level then we may witness a further rally up to 17630-17770-17855 levels. However, if NIFTY trades below 17550 levels then we may see some profit booking initiating in the market, which may correct up to 17410-17325-17185 levels.

Banknifty

Banknifty opened with a downward gap and selling pressure throughout the session led it to close in negative terrain. Banknifty closed at 38298 with a loss of 688 points.

On the daily chart the index has formed a sizable bearish candle and closed below previous session's low indicating further weakness. The index continues to move in a Lower Top and Lower Bottom formation on the hourly chart indicating negative bias. The chart pattern suggests that if Banknifty crosses and sustains above 38500 level it would witness buying which would lead the index towards 38700-39000 levels. However if index breaks below 38200 level it would witness selling which would take the index towards 38000-37700. Banknifty is trading above 20, 50 , 100 and 200 day SMA's indicating positive bias in the short to medium term. Banknifty continues to remain in an uptrend in the short term, so buying on dips continues to be our preferred strategy.

The daily strength indicator RSI is moving downwards and is quoting below its reference line indicating negative bias.

The trend deciding level for the day is 38425. If BANK NIFTY trades above this level then we may witness a further rally up to 38605-38910-39090 levels. However, if BANK NIFTY trades below 38425 levels then we may see some profit booking initiating in the market, which may correct up to 38120-37940-37635 levels.

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