While the bulls were in complete control today, the Nifty remains in a trading range between 5420 and
5550. This is a narrow 130 point range which has been established over a period of four days. It is quite narrow to sustain for any length of time. Then, we can expect a breakout/breakdown from the range, any day. A close above 5550 will tell us there is more upside. A move below 5420 will give suggestions of
significantly more downside.Support comes in around 5480. A dip to 5480 may be considered as a buy on dip. Of course, keep a stop. A breakout above 5550 should be used to initial / add new long positions. Of course, below 5420 all buying should be suspended.
The bank Nifty remains in a consolidation, just like its big boss - the Nifty. The Bank chart has an Insync indicator which is much above the minus 45 oversold area. This could mean any one of the two options: (a) Banks are outperforming with the indicator remaining high up OR (b) The Insync indicator has lot of room to fall as it goes towards the minus 45 oversold level. It is not easy to determine which of the two options may work out. To keep trading simple, a breakout from the trading range is a buy.
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