The Nifty is likely to consolidate further with a positive bias.
As discussed yesterday, the Nifty opened with a gap down and traded with a negative bias for most of the session, until at the very last hour, it spiked up to close with a modest gain of 8 points. Today, given the global cues, the Nifty is likely to open with a positive gap up, however, its sustainability at higher levels is suspicious.
1) The Elder Ray readings : Bull Power reduces from +112 to +81 Bear Power increases from +47 to +28 indicating that the Bears are gaining some strength, however they are still not in their safe zone. On the other hand, the Bulls are not able to sustain their momentum.
2) The Nifty is trading well above its key EMAs and is also above its 50DMA which is at 4843 and is rising. The Nifty is expected to remain strong above this level.
3) The stochastics are still deeply within the overbought zone. However, they are not showing any indication of coming out of that zone.
4) In the above chart, the volumes have again depleted in yesterday's rise in the Nifty, raising suspicion on the sustainability of the move. The MACD histogram is showing a bearish diversion, and the ADX is showing loss of momentum in the up-move.
5) Considering the above, our trading plan for the day is as under,
a) Below 4905, we will open fresh short positions with a SL of 4925 and a target of 4855. We will add to these short positions only below 4820.
b) Above 4865, we will open fresh long positions with a SL of 4845 and a target of 4905. We will add to these long positions only above 4925.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
As discussed yesterday, the Nifty opened with a gap down and traded with a negative bias for most of the session, until at the very last hour, it spiked up to close with a modest gain of 8 points. Today, given the global cues, the Nifty is likely to open with a positive gap up, however, its sustainability at higher levels is suspicious.
1) The Elder Ray readings : Bull Power reduces from +112 to +81 Bear Power increases from +47 to +28 indicating that the Bears are gaining some strength, however they are still not in their safe zone. On the other hand, the Bulls are not able to sustain their momentum.
2) The Nifty is trading well above its key EMAs and is also above its 50DMA which is at 4843 and is rising. The Nifty is expected to remain strong above this level.
3) The stochastics are still deeply within the overbought zone. However, they are not showing any indication of coming out of that zone.
4) In the above chart, the volumes have again depleted in yesterday's rise in the Nifty, raising suspicion on the sustainability of the move. The MACD histogram is showing a bearish diversion, and the ADX is showing loss of momentum in the up-move.
5) Considering the above, our trading plan for the day is as under,
a) Below 4905, we will open fresh short positions with a SL of 4925 and a target of 4855. We will add to these short positions only below 4820.
b) Above 4865, we will open fresh long positions with a SL of 4845 and a target of 4905. We will add to these long positions only above 4925.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
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