Last
week, Nifty opened on flat note and traded with positive bias for most part of
the week. On week on week basis index rose 2.50%. With last week gains, the
Nifty, after three weeks of consolidation, gave a breakout on the upside by
closing above it’s the eleven week’s down sloping trend line. For the second consecutive week, index formed
a bullish candle with higher High-Low formation, suggesting positive bias among
traders. On the daily chart, index managed to cross the 61.2% Fibonacci
retracement level of 4882 but failed to close above the same. Daily prices have formed a Doji candles which
illustrate market indecision. From current levels index has immediate
resistance at the down gap area formed on 9th Dec. in the range of 4921-4918
levels. Any move above the said level would lead it to test 4,950 and 4,980.
For the coming week, index is expected to continue its positive momentum in the
range of 4800 to 5000 levels. On the downside, immediate supports are remains
at 4,780 (20-day EMA).
The weekly strength
indicator RSI is placed positive above its reference line indicating rising
strength. The momentum indicator- Stochastic has also turned up from oversold
zone which supports bullish momentum to continue in the near term.
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