What the Market looks like. We are in an uptrend after a sharp decline. This should be considered a relief rally. But, as rallies go, the market can go up and give a lot of relief. However, the long term trend remains down. We should expect lower levels in the next few months. Nifty Watch:- The Nifty opened at 5566 with a gap of 16 points. The Index quickly made a high at 5589, and then moved down to its day low at 5436 with a decline of 153 points to its day high and finally closed at 5468 with a decline of 98 points to its open.
Today’s market decline may be a correction of the ongoing short term up trend. As we have discussed yesterday, traders should have taken partial profits in the morning when the Nifty was touching 5600. Any remaining short term positions should have been stopped out at 5500.
Trend:- The short term trend is remains up despite today's correction. A close below 5350 is required to change this trend to down.The Intermediate trend remains down, with the Nifty trading below its 200 days and 50 days moving average. We may see choppy market conditions next week with markets responding randomly to various pre-budget events. Fresh buying is suggested if and when the Nifty closes above 5550. These levels will change over time.
TA Insync(55-5) is now above the level of -45 and still moving up. This indicator is suggesting upside momentum.
Level:- Looking for support at 5460, then 5350. Major resistance comes at 5550. After a rally of 414 points this week (from 5175 to 5589) nifty may start a consolidation. Thus coming few days may be trading between the ranges of 200 points - 5350 to 5550
Summary:- As Budget will come in next month thus the market may start consolidation before the budget. This can lad to choppy market conditions. Below the fibonacci retracement down levels are shown in the chart. We note that the Nifty has corrected 38% of the up move. This was the minimum requirement. We could expect a correction towards 50% - 5382 or even 61.8% which will be 5333. Therefore, it is wise to wait till the Nifty either moves up above 5550 or
remains stable at any one of the retracement levels.
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