A gap down opening for the week as anticipated in last week's analysis.The gap was closed immediately but the bears dominated and selling continued throught the week breaking below the flag pattern.Support taken on the downtrendline from November 2010 highs.This needs to hold else selling will intensify and has chances of touching the support line of the down trending channel from which the Bank Nifty had successfully broken out.
Rsi14 is below the 50 mark showing more weakness to come.Stochastics is below 20 mark showing oversold status.This would mean a sell on rise would be beneficial.
A minor lower low made but the small real body and long upper shadow could be conveying that selling may pause for some time.Support taken on the red dotted support line of the flag formation is encouraging.The oversold Rsi14 and Stochastics support this view.
The falling wedge shown on thursday failed to play out. Another rising wedge has formed alongwith positive divergence on half hourly charts.This may lead to some recovery. Strong resistance at 9532 as shown on the chart.
Till 9924 is crossed decisively sell on rises.
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