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Nifty

Nifty continued to consolidated within the 5 DEMA & 20 DEMA range of 24495 to 24270 throughout the day. The reaction low during the union budget announcement near its psychological base of 24000 remains a key zone to guage the upcoming upmove. With its OIPCR rebounding from its oversold zone & firm signs of option base at 24000 to remain intact indicate a steady base for the august series. From a trend perspective the recent occurrence of a ‘Bullish Hammer’ is a sign of confidence but a close above 24565 would mark the termination of the price correction, until then expect consolidation to time correction to continue. With the RSI displaying a declining trend and the ADX continuing to trend at 26, both of its trend strength indicators are diverging & display lack of conviction for any trending move. Options data indicates a firm base at 24300 followed by 24000 while a move above 24500 would unlock a major short covering rally towards 25000. For the day expect consolidation to continue within 24000-24400 zone while Bank nifty could continue to see further slippages towards 50000.

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