As the Nifty approaches 5380, technicals indicate weakening of the up move.
As discussed yesterday, we saw the Nifty "still consolidating" throughout the trading session within a confined range of 45 points. However, the close was near the high of the day, indicating strengthening of the Bulls. Consolidations are difficult to trade, and hence, we were happy to see them through sitting on the sidelines, as none of our trading plans get triggered during these contraction phases.
1) The Elder Ray readings : Bull Power rises from +68 to +78 Bear Power reduces from +32 to +35, indicating the grip of the Bulls on the Nifty. For today, the Bulls need to overcome the levels of 5365 on the Nifty to maintain their upwards momentum, whereas the Bears need to breach the Nifty below 5280 to regain their lost grounds.
2) The Nifty continues to close well above all its key EMAs and all its key DMAs.
3) The stochastics continue to remain in the overbought zone, indicating the strength of the bullish momentum.
4) In the above chart, the volumes have decreased with the rise in the Nifty towards the top end, indicating that the momentum might weaken at the top. The MACD has continued its rise, indicating that the bullish up move might sustain. The ADX is also favoring the Bulls but is suggesting further weakening of the trend. The Parabolic SAR continues with its buy signal with a SL now pegged at 5209.
5) Considering the above, our trading plan for the day is as under
a) Around 5325, we will open fresh long positions with a SL of 5295 and a target of 5375. We will add to these long positions only above 5400.
b) Around 5385, we will open fresh short positions with a SL of 5400 and a target of 5335. We will add to these short positions only below 5295.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
As discussed yesterday, we saw the Nifty "still consolidating" throughout the trading session within a confined range of 45 points. However, the close was near the high of the day, indicating strengthening of the Bulls. Consolidations are difficult to trade, and hence, we were happy to see them through sitting on the sidelines, as none of our trading plans get triggered during these contraction phases.
1) The Elder Ray readings : Bull Power rises from +68 to +78 Bear Power reduces from +32 to +35, indicating the grip of the Bulls on the Nifty. For today, the Bulls need to overcome the levels of 5365 on the Nifty to maintain their upwards momentum, whereas the Bears need to breach the Nifty below 5280 to regain their lost grounds.
2) The Nifty continues to close well above all its key EMAs and all its key DMAs.
3) The stochastics continue to remain in the overbought zone, indicating the strength of the bullish momentum.
4) In the above chart, the volumes have decreased with the rise in the Nifty towards the top end, indicating that the momentum might weaken at the top. The MACD has continued its rise, indicating that the bullish up move might sustain. The ADX is also favoring the Bulls but is suggesting further weakening of the trend. The Parabolic SAR continues with its buy signal with a SL now pegged at 5209.
5) Considering the above, our trading plan for the day is as under
a) Around 5325, we will open fresh long positions with a SL of 5295 and a target of 5375. We will add to these long positions only above 5400.
b) Around 5385, we will open fresh short positions with a SL of 5400 and a target of 5335. We will add to these short positions only below 5295.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
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