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Nifty

At the end of the week, On Friday Nifty was successful to maintain its close above its 5 DEMA support level of 21286. The index formed a relatively small body candle while it remained confined within the large selling bar formation of 20DEC 2023 which culminated as a strong unwinding session confirming the near-term top at 21600. After a strong price runup from the base of 19000 the index now requires a gradual price & time correction to hold its bull trend intact. Its immediate support base is now defined near 20860 to 20710 zone which remain a dependable support cluster to redeploy buy on declines strategy. A significant correction can only be anticipated if the index closes below the20710 zone on weekly basis. On the other hand, the record high of 21,593 is likely to be a significant barrier as a successful consecutive closing above it can trigger a new leg of the rally. Option data too indicates the immediate range to remain intact at 21500-21000 itself with 21300 now its approx. midpoint with outer wings placed at 20800 to 21600 respectively for the final leg of the series. It’s ideal to wait for the occurrence of a near term bullish reversal pattern to redeploy longs near the anticipated major support zone around 20810-20710 with a stop below 20520. Until then expect a healthy time & price correction to form a fresh elevated base for the ongoing bullish structure.

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