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Nifty

Nifty opened sharply lower with a downward gap and selling pressure throughout the session dragged it lower to close near the day's low. Nifty closed at 17808 with a loss of 150 points.

On the daily chart the index has formed a bearish candle with a long upper shadow indicating selling pressure as well as resistance at higher levels. The index is moving in a Higher Top and Higher Bottom formation on the daily chart indicating a sustained up trend. The chart pattern suggests that if Nifty crosses and sustains above 17900 level it would witness buying which would lead the index towards 18000-18100 levels. However if the index breaks below 17700 level it would witness selling which would take the index towards 17600-17500. Nifty is trading above its 20 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 is moving upwards and is above its reference line indicating positive bias.

The trend deciding level for the day is 17830. If NIFTY trades above this level then we may witness a further rally up to 17880-17950-18000 levels. However, if NIFTY trades below 17830 levels then we may see some profit booking initiating in the market, which may correct up to 17760-17710-17635 levels.

Banknifty

Banknifty opened sharply lower with a downward gap and selling pressure throughout the session dragged it lower to close on a negative note. Banknifty closed at 37633 with a loss of 435 points.

On the daily chart the index has formed a bearish candle with a long upper shadow indicating selling pressure as well as resistance at higher levels. The index is moving in a Higher Top and Higher Bottom formation on the daily chart indicating a short term up trend. The chart pattern suggests that if Banknifty crosses and sustains above 37800 level it would witness buying which would lead the index towards 38000-38200 levels. However if index breaks below 37500 level it would witness selling which would take the index towards 37200-37000. Banknifty is trading above 20 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 positive and is above its reference line indicating sustained strength. The trend deciding level for the day is 37670. If BANK NIFTY trades above this level then we may witness a further rally up to 37830-38025-38185 levels. However, if BANK NIFTY trades below 37670 levels then we may see some profit booking initiating in the market, which may correct up to 37475-37315-37120 levels.

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