Half Hourly Chart
The Daily charts signal weak markets. The 5dema has crossed below the 10dema. Stochastics has moved below 20 signalling oversold markets. RSI 14 is below 50 mark and Macd above zero line but in sell mode.The upper trendline of the falling channel proved strong resistance and Nifty tried unsuccessfully to stay above it. Unless we scale this trendline possibilities of testing the lower trendline gets stronger. But strong supports at 4380-4325 has to be contended with before reaching those levels. The 50 dema is at 4332.
The oscillators on half hourly charts have moved up from the oversold region showing positive divergence intraday, but have wilted by end of day. The rising wedge target of 4378 is very much achievable with momentum being on the downside. In case there is a pullback we may be forming the right shoulder of the head and shoulder pattern shown on half hourly charts with neckline at 4430. In case this plays out and the Nifty breaks the neckline we have a target of 4130.
We may expect profit booking once the target of 4380 is reached leading to a bounce. Look for oppurtunities to go short with a stop loss of 4600.
Happy Trading !!