INSUBCONTINENT EXCLUSIVE:
After a modest start to trade, Nifty50 spent the first half of the session in a capped range, as it traded with modest gains
It was the second half that saw Nifty lose ground
Though some caution towards the end was expected given the long weekend ahead, but the weaker seen was more than expected
important, and it is likely to decide market trajectory for the coming few days
If the Index breaches this level, the market will once again get inside the falling channel that it has formed over the past couple of
weeks.
The 10,605 and 10,640 levels are likely to act as immediate resistance for the market, while supports should come in at 10,480 and
10,430.
The Relative Strength Index or RSI on the daily chart stood at 48.0080 and it marked a fresh 14-period low, which is a bearish
The RSI has also showed a bearish divergence against price
However, the daily MACD remains bullish, but it has seen narrowing of its trajectory.
A pattern analysis on the charts showed the Nifty has
managed to move out of the falling channel that it had formed over past couple of weeks
After moving out of this channel, the upward move got stalled at the 200-DMA, which stands at 10745
Nifty not only saw some retracement, but now sits on the verge of getting back into the falling channel once again.
It will be necessary for
Nifty to pull back again to avoid getting into the falling channel once again
Nifty has to scale the 10,550 level and go higher to remain in consolidation and avoid further weakness
Any move below 10,510 will make the market vulnerable to more weakness
We suggest investors to protect profits at every rise
Overall exposure should be kept at modest levels, and aggressive positions on either side should be avoided.
A cautious view is advised for
the day.
(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research Advisory Services, Vadodara
He can be reached at milan.vaishnav@equityresearch.asia)
