Nifty Daily ChartThe triangle breakout seems to be under threat as the nifty, though just marginally, has closed above the lower trendline of the triangle. The 2807 levels is really important now. Trading above or below it will be the decider for taking positions. It is the intersection of the the lower trendline of the triangle and the upper trendline of the recent channel in which the nifty is trading since January 2009.
The two dojis formed in the last two days shows waning upward momentum. Also the upper trendline of the channel has proved stiff resistance and inspite of good momentum since bottom at 2539, the breakout from the channel failed. Momentum indicators also show weakening before reaching oversold levels indicating the rally was just a corrective one.
Resistance is at 2845-2850 which is 50 % retracement levels of fall from 2970 to 2539 and 2850 is resistance of trendline , shown in green in the chart, joining January and March 2008 lows. If this resistance is crossed then we have next resistance at the 61.8% level at 2920 and the earlier top at 2970. So a host of resistances to overcome.
Fibonacci supports are at 2766-2724-2690-2652.
By the way the 84 SMA on daily charts which I have referred to earlier as a stiff resistance to upmoves is at 2816. Trade via option route if you have to as direction is not clear. Also settlement week has its share of excess volatility.
Happy Trading !!
Lakshmi Ramachandran
www.vipreetsafetrading.com
No comments:
Post a Comment