Nifty retested the crucial support at 4783 on the descending trend line. Then nifty never looked back & started an uptrend by making higher highs at 5300, 5450, 5813 now 6099 on 22nd January 2013. The nifty high of 6101-6099 is touching the uptrend line while joining the old higher highs of 5336, 5616.
A well modulated uptrend consists of higher highs and lower lows which can be observed at 5033, 5216 and 5560. These lower lows (5033, 5216 & 5560) are a crucial nifty support points on an uptrend line. The moving averages 13ema, 34ema, 50 sma & 100sma can be observed lending support to current daily nifty price action along with volume which is rising along with the uptrend. A good sign that bulls are heavily participating in this rally.
The momentum indicator KST is showing negative divergence in the overbought zone, which indicate rally may slow down or is losing steam. The buying interest though still held by bulls. But bears may spring a surprise on unsuspecting bulls & could be waiting on the sidelines to hamper the rally.
Technical Conclusion: Though most technical finding indicates bullish environment, but the rally looks tired and building of negative divergence should be heeded. The market may take a rest for sectoral churn.
Invest or not to invest: A positional nifty short trade can be generated if an uptrend line of 6099 is not crossed on the upside and if nifty cracks down then on support on uptrend line new nifty future long position can be initiated with strict stop loss. Again new positional trade in nifty future can be initiated on KST Indicator touching the zero line & giving crossover in overbought zone.
This Opinion piece/Views presents the opinions/views of the author. It does not necessarily reflect the views of MarketExpress, its publisher, the Company for MarketExpress, or its sponsor.
MarketExpress or anyone involved with MarketExpress will not accept any liability for loss or damage as a result of reliance on the information including data, quotes, charts and buy/sell signals contained within this website. Please be fully informed regarding the risks and costs associated with trading the financial markets, it is one of the riskiest investment forms possible.
MarketExpress would like to remind you that the data contained in this website is not necessarily real-time nor accurate. All CFDs (stocks, indexes, futures) and Forex prices are not provided by exchanges but rather by market makers, and so prices may not be accurate and may differ from the actual market price, meaning prices are indicative and not appropriate for trading purposes. Therefore MarketExpress doesn’t bear any responsibility for any trading losses you might incur as a result of using this data .