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Nifty

Occurrence of a ‘Bearish Bar’ post the sequence of narrow ranged bodies serves as a confirmation of loss in existing momentumstrength. Theindexagain took support at its 5 DEMA support level of 20880 & managed to close above the same. The recent ‘Hanging Man’ formation awaits confirmatoryclose below 20850 for bearish implications to get activated. Option data is indicating 21000 to remain a strong hurdle for the current seriesbutthemajor bearish implications would come into play if the index slips below 20700. On the indicators front, its daily RSI has denoted a negativecrossoverwithin its overbought zone while its ADX is at 63 confirming the lack of strength. The ongoing rally is expected to exhaust around 21040-21080zone&hence it is advised to reduce long positions going forward & remain light to renter at lower levels around 20340 (Gap Support). Aggressiveshortscouldbe considered as well at this junction but leverage positions can be added once on confirmatory close below 20710.

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