With technicals in the oversold zone, the overtly bearish Nifty may whipsaw wildly.
Yesterday, we had said,"The rally may not sustain", and what we got is a huge gap down of 68 points and then the Nifty never looked like regaining strength till reaching 4837, where a mild rally to 4882 fizzled out quickly, and the Nifty closed at 4858. Today, again we may get a flat to positive opening, and then the Nifty is expected to gyrate wildly between 4800 and 4920, and we need to be nimble footed and brave-hearted at the same time, which is a difficult task.
1) The Elder Ray readings : Bull Power reduces from -91 to -137 Bear Power increases from -177 to -182, indicating that the Bulls are losing steam at a greater pace than the Bears are gaining momentum. For today, the Bulls need to overcome 4995 to regain their lost grounds whereas the Bears need to breach the Nifty below 4810 to maintain their momentum.
2) The Nifty is trading well below its key EMAs and its key DMAs. The 50 and 200 DMAs have started accelerating in their falls.
3) The stochastics and the RSI are in the oversold zone, and are trying to look up, which gives the Nifty a probability of trying to bounce back.
4) In the above chart, the volumes are rising with the fall in the nifty indicating sustenance in the downward momentum. The MACD has started its fall again. The ADX is suggesting a strong trend which is favoring the Bears. The Parabolic SAR is continuing with its sell signal.
5) Considering the above, our trading plan for the day is as under.
a) Around 4905, we will open fresh short positions with a SL of 4925 and a target of 4810. We will add to these short positions only below 4785.
b) Around 4800, we will open fresh long positions with a SL of 4785 and a target of 4885. We will add to these long positions only above 4925.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
STGPXMGSHQ48
Yesterday, we had said,"The rally may not sustain", and what we got is a huge gap down of 68 points and then the Nifty never looked like regaining strength till reaching 4837, where a mild rally to 4882 fizzled out quickly, and the Nifty closed at 4858. Today, again we may get a flat to positive opening, and then the Nifty is expected to gyrate wildly between 4800 and 4920, and we need to be nimble footed and brave-hearted at the same time, which is a difficult task.
1) The Elder Ray readings : Bull Power reduces from -91 to -137 Bear Power increases from -177 to -182, indicating that the Bulls are losing steam at a greater pace than the Bears are gaining momentum. For today, the Bulls need to overcome 4995 to regain their lost grounds whereas the Bears need to breach the Nifty below 4810 to maintain their momentum.
2) The Nifty is trading well below its key EMAs and its key DMAs. The 50 and 200 DMAs have started accelerating in their falls.
3) The stochastics and the RSI are in the oversold zone, and are trying to look up, which gives the Nifty a probability of trying to bounce back.
4) In the above chart, the volumes are rising with the fall in the nifty indicating sustenance in the downward momentum. The MACD has started its fall again. The ADX is suggesting a strong trend which is favoring the Bears. The Parabolic SAR is continuing with its sell signal.
5) Considering the above, our trading plan for the day is as under.
a) Around 4905, we will open fresh short positions with a SL of 4925 and a target of 4810. We will add to these short positions only below 4785.
b) Around 4800, we will open fresh long positions with a SL of 4785 and a target of 4885. We will add to these long positions only above 4925.
Happy Trading !!!
For cash market recommendations see our Daily Pre Market calls on NSE
STGPXMGSHQ48
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