Nifty (6526.65, +125.50, +1.96%)
The rise is uncomfortably vertical and we are expecting a correction in the day’s session even if it were to open higher and post a higher high compared to the last Friday’s all-time high of 6537.80. This kind of large price swing in the Nifty has happened twice (Sep 19 and Oct 18 last year) in the last six months and they led to a short term reversal on both occasions. Current upswing has already overstretched stock prices quite a bit and on top of that this last day’s gain of 125+ points clearly point to an impending correction—either a short downswing or a sideways consolidation. However, so long as the zone between 6446 and 6385 does not broken on high volume bulls would again try to pull things up to test the index high again.
Most critical level: 6492, its first support as well
Strong support: 6446 – 6385
Major support: 6362 – 6343
Strong resistance: 6538 – 6549
Major resistance: 6579 – 6604
Bank Nifty (11884.75, +606.40, +5.38%)
Even this huge performer is also well set for a corrective downswing. These huge vertical rallies generally happen just prior to a correction. However, unless you see the range between 11500 and 11300 getting violated on heavy selling the current upside momentum is unlikely to cause any serious concern. On the way up, it needs to clear the important supply zone between 12203 and 12246 no sustained rally is probable. In case, it goes down it is likely to take support at 10933 through 10860 range. So long as this range is not taken out, we can expect the bulls to stage a comeback again since neither the Nifty nor the Bank Nifty has risen so far on negative divergence.
Most critical levels: 11760 – 11685
Strong Support: 11500 – 11300
Major support: 10933 – 10762
Strong resistance: 12203 – 12246
Major resistance: 12538
The rise is uncomfortably vertical and we are expecting a correction in the day’s session even if it were to open higher and post a higher high compared to the last Friday’s all-time high of 6537.80. This kind of large price swing in the Nifty has happened twice (Sep 19 and Oct 18 last year) in the last six months and they led to a short term reversal on both occasions. Current upswing has already overstretched stock prices quite a bit and on top of that this last day’s gain of 125+ points clearly point to an impending correction—either a short downswing or a sideways consolidation. However, so long as the zone between 6446 and 6385 does not broken on high volume bulls would again try to pull things up to test the index high again.
Most critical level: 6492, its first support as well
Strong support: 6446 – 6385
Major support: 6362 – 6343
Strong resistance: 6538 – 6549
Major resistance: 6579 – 6604
Bank Nifty (11884.75, +606.40, +5.38%)
Even this huge performer is also well set for a corrective downswing. These huge vertical rallies generally happen just prior to a correction. However, unless you see the range between 11500 and 11300 getting violated on heavy selling the current upside momentum is unlikely to cause any serious concern. On the way up, it needs to clear the important supply zone between 12203 and 12246 no sustained rally is probable. In case, it goes down it is likely to take support at 10933 through 10860 range. So long as this range is not taken out, we can expect the bulls to stage a comeback again since neither the Nifty nor the Bank Nifty has risen so far on negative divergence.
Most critical levels: 11760 – 11685
Strong Support: 11500 – 11300
Major support: 10933 – 10762
Strong resistance: 12203 – 12246
Major resistance: 12538
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