22-02-2024 10:18 AM | Source: Tradebulls Securities Ltd
Nifty managed to retain its close above its 5 DEMA support level - Tradebulls Securities

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Nifty

On its daily scale the occurrence of an ‘Engulfing Bearish’ formation could derail the ongoing bullish momentum. Despite of the profit booking pressure across the broader spectrum of market; nifty managed to retain its close above its 5 DEMA support level of 22030. Since both its trend strength indicators remain diverging with RSI trending higher around its 59 while ADX is yet to cross its 20 level; their respective placement indicates lack of conviction in directional strength as of now. Option data highlights an immediate strong support zone at 22000 followed by 21800 itself. On the flip side unwinding by call writers of 22100-22200 would push the index immediately within a positive territory else expect the index to face selling pressure on the higher side. Since India VIX (Volatility /Fear Index) too remains confined within 16 level (its 200 WEMA level) & 14.70 (its 5 WEMA); this consolidation is a sign for traders to avoid leverage positions on either side & wait for a firm breakout of this range. Hence the outlook remains cautious as sector rotational move would attract further rise in volatility.

 

 

 

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