Reigning The Nifty--7th May,2009

Nifty Daily Chart

Nifty Half hourly Chart

I wrote yesterday ,"the target of 3737 is very important and we may have profit booking once it is reached". Nifty made a high of 3717 very close to the target before correcting.

Case for a possible coreection/Reversal

• The doji candle formed on the daily charts , may have marked a turning point as today's candle was bearish.
  
• The upper shadow is long conveying weakness at higher levels.
• The real body(range between open and close) is below the real body of the doji candle.
  
• The close is towards the low of the day.
• It was a down day.
• negative divergences continues on daily charts.
  

Key to further weakness would be break of yesterdays low at 3608. On the 30 minute chart the shorter term trendline shown in red has been broken. Any further weakness may take the Nifty to 3540-3517 levels which will provide good support.

Refer the charts for retracement levels . The trend is up till the pink dotted trendline, drawn from 2965 , shown on half hourly chart is broken. But maybe this is a crossroad once again. Be hedged on any positions taken.

Happy Trading !!

Lakshmi Ramachandran
www.vipreetsafetrading.com