Nifty Extends Rebound, Closes Above 5-DEMA - Tradebulls Securities Pvt Ltd
Nifty
Nifty commenced the week on a strong footing, extending its rebound for the second consecutive session and closing at 22,776, firmly above its 5 DEMA. The improving price-RSI positive divergence continues to support the recovery, although the index is now approaching the crucial 22,800 resistance zone, warranting caution. A sustained move above 22,800 could encourage further short-covering and potentially push Nifty towards 23,000, which remains the key derivative and psychological hurdle. The RBI MPC outcome and, more importantly, its commentary on inflation, crude and the future rate trajectory could determine whether this rebound gains traction or fades at higher levels. Markets are pricing in a possible 25-bps hike, while FII selling remains a concern despite strong DII support. Technically, 22,800–23,000 is the make-or-break zone: sustained acceptance above 23,000 would materially strengthen the reversal case, whereas failure to cross 22,800 could keep the index range-bound and expose it to profit-taking. Traders should therefore avoid chasing the rebound and await confirmation around these levels.
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