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Nifty

Nifty opened with a downward gap and traded with extreme volatility on either side and gained the bullish momentum at the end of the day. Nifty closed at 16615 with a gain of 52 points.

On the daily chart index has formed a bullish candle and has closed above its previous session's high indicating positive bias. 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 16650 level it would witness buying which would lead the index towards 16700-16800 levels. However if index breaks below 16550 level it would witness selling which would take the index towards 16500-16400. 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 16580. If NIFTY trades above this level then we may witness a further rally up to 16665-16715-16795 levels. However, if NIFTY trades below 16580 levels then we may see some profit booking initiating in the market, which may correct up to 16530-16445-16395 levels.

Banknifty

Banknifty opened lower with a downward gap and extended selling momentum in the first half however buying momentum at lower levels erased most of the earlier losses. Banknifty closed at 35867 with a loss of 227 points.

On the daily chart, the index has formed a Bearish candle with a lower shadow indicating buying at lower levels. Since past couple of weeks index continue to consolidate in a broad trading range (36300- 35500) representing sideways trend. The chart pattern suggests that if Banknifty crosses and sustains above 36100 level it would witness buying which would lead the index towards 36200-36400 levels. However if index breaks below 35600 level it would witness selling which would take the index towards 35400-35200. 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 weakness at current levels.

The trend deciding level for the day is 35825. If BANK NIFTY trades above this level then we may witness a further rally up to 36035-36205-36420 levels. However, if BANK NIFTY trades below 35825 levels then we may see some profit booking initiating in the market, which may correct up to 35655- 35440-35275 levels.

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