IGI Logo

On the daily scale, Nifty appears to be forming an ‘Ending Diagonal’ reversal setup, with key pattern bounds placed at 21,800 and 23,040. However, the index has yet to confirm a bullish reversal, as it lacks a positive RSI divergence and continues to trade within a lower top-lower bottom structure. A transition into a bullish sequence from this setup will require confirmation. In the short term, Nifty remains confined within a broad 21,800–23,000 range, with momentum traders using 22,120 as a trailing stop. Options data for the week suggests firm bounds between 22,000 and 23,000, with 22,500 emerging as a pivotal zone for sustaining momentum. However, two key concerns persist; The index has yet to secure a weekly close above the 5-week exponential moving average (5 WEMA). The Average Directional Index (ADX) remains below 25, indicating a lack of strong trend momentum. If 21,800 breaks, it could trigger a deeper correction, while 23,040 holds the key for a bullish breakout. Keeping an eye on volume and price action at these levels should help fine-tune entries and exits. Trailing stop for momentum traders is placed at 22,120. Traders should stay cautious yet optimistic, watching for a breakout beyond 23,040 to confirm a shift in market sentiment.

Please refer disclaimer at https://www.tradebulls.in/disclaimer

SEBI Registration number is INZ000171838