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Nifty
Trend
Support
7845
Down
7720
Resistance
7910
Current Observation:
After showing a sharp decline in last session, Nifty opened today with weak note, but shifted into smart recovery and
closed the day higher by around 33 points.
Nifty opened today with the downside gap of around 85 points and started to show recovery soon after the opening.
The recovery attempt continued till the end of session and the opening downside gap has been filled completely.
We observe a formation of thrusting line type candlestick pattern today, just after the formation of a sharp negative
candlestick pattern of bearish engulfing of Tuesday.
In the past, the bearish engulfing patterns have been formed near the lower/minor tops over the last 7-8 months and
they have led to a reasonable declines in Nifty for some period. Hence, though, todays recovery attempt is signaling a
buying interest from the lows, but the current upside recovery could not be sustained for long.
Tuesdays bearish engulfing pattern could be intact, as long as the upper area of the pattern of 8020 is protected. In the
meantime the mid area of Tuesdays long range bear candle around 7910 levels could offer resistance for the rising
Nifty from here.
RETAIL RESEARCH
The negative swing indicator like DMI has widened afresh in the last couple of sessions, which is indicating a strength
of negative swing in Nifty.
Though Nifty showed a smart lower levels recovery in todays session, the underlying trend remains weak and there is a
possibility of further weakness from the highs. We believe that this recovery attempt is unlikely to move above the
important resistance area of 8020 levels.
Traders may continue with the short positions in the market/stocks with the higher levels stoploss of 8020 as on closing
basis.
RETAIL RESEARCH
RETAIL RESEARCH