INSUBCONTINENT EXCLUSIVE:
overdue corrective move, that was expected
The market was overbought on both timeframe charts and was visibly overextended
We have seen the formation of a big engulfing bearish candle
The 11,760 level has now become an immediate top for Nifty
We expect the market to remain subdued and see a healthier correction preparing for the resumption of another rally
Daily strength indicator RSI and the momentum indicator Stochastic both turned negative from the overbought zone, which signalled a price
and closed below the support zone of last five sessions, indicating a negative bias
With the current close, the index has broken down the up-sloping channel of last two months at 11,630 on a closing basis, indicating a
formed a lower top-lower bottom on the daily chart, which suggests that the short-term trend has turned in favour of the bears
The short-term momentum indicator has triggered a bearish crossover
Thus, the index looks poised for a dip towards 11,300 level, said Gaurav Ratnaparkhi, Senior Technical Analyst, Sharekhan by BNP Paribas.
