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Nifty

Nifty opened sharply lower with a downward gap and traded with extreme volatility throughout the session to close on a negative note. Nifty closed at 16240 with a loss of 62 points.

On the daily chart index has formed a bearish candle however it remained restricted within past four session's HighLow range indicating absence of strength on either side. The index is moving in a Lower Top and Lower Bottom formation on the daily chart indicating negative bias. The chart pattern suggests that if Nifty crosses and sustains above 16400 level it would witness buying which would lead the index towards 16500-16700 levels. However if the index breaks below 16200 level it would witness selling which would take the index towards 16100-15900. Nifty is trading below its 20, 50, 100, and 200-day SMA which indicates negative bias in the short to medium term. Nifty continues to remain in a downtrend in the short to medium term, so selling on rallies 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 16280. If NIFTY trades above this level then we may witness a further rally up to 16365-16490-16570 levels. However, if NIFTY trades below 16280 levels then we may see some profit booking initiating in the market, which may correct up to 16155-16075-15950 levels.

Banknifty

Banknifty opened on a flat note and witnessed buying momentum for the first part of the session. However selling pressure at higher levels erased most of the earlier gains. Banknifty closed at 34483 with a gain of 207 points.

On the daily chart index has formed a bullish candle and has formed a higher High-Low formation indicating positive bias. The index is moving in a Lower Top and Lower Bottom formation on the daily chart indicating negative bias. The chart pattern suggests that if Banknifty crosses and sustains above 34500 level it would witness buying which would lead the index towards 34800-35200 levels. However if the index breaks below 34200 level it would witness selling which would take the index towards 34000-33700. Banknifty is trading below 20, 50, 100 and 200 day SMA indicating negative bias in the short to medium term. Banknifty continues to remain in a downtrend in the short to medium term, so selling on rallies continues to be our preferred strategy.

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

The trend deciding level for the day is 34480. If BANK NIFTY trades above this level then we may witness a further rally up to 34785-35085-35390 levels. However, if BANK NIFTY trades below 34480 levels then we may see some profit booking initiating in the market, which may correct up to 34180-33875-33575 levels.

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