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Nifty

Nifty opened with a strong gap-up above its 20 DEMA level of 22620 and managed to sustain this support throughout the session. This breakout from consolidation was backed by healthy volumes, propelling the index toward the upper end of the ending diagonal formation, positioned around the 22900–23040 zone. The technical setup indicates the potential for a dynamic move toward the 200 DEMA level of 23400 within this month. With the ADX turning positive and approaching the 25 mark, along with the RSI comfortably trending above 50, the momentum is strengthening. Options data suggests a shift in the base toward 22,500–22,700, while the upside for the week appears capped at 23,000. A decisive breakout beyond this level could trigger a sharp short squeeze, especially as the volatility index (VIX) nears a fresh breakdown below 13. Given these signals, traders should remain cautiously optimistic. A breakout beyond 23,040 would confirm a shift in sentiment, while 22,500 now acts as a firm momentum stop-loss level for long positions.

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