Nifty expectedly broke out of the falling wedge formation and has had a steep rally of almost 300 points. Now as we mentioned in our previous post, the crucial level to watch on the upside remains 5830 odd levels. However, adding another trendline gives more confirmation to this crucial zone of 5830 - 5870.
So one may safely book out their longs completely near the supply zone.
To protect this uptrend the level of 5650 has become vital and must be held on during any corrections. Nifty may oscillate in the band of 5650 - 5850 before giving further clue as the broader market has yet not fully participated in the rally. So stock specific movements can continue while Nifty may oscillate within this range before showing direction on either side.
Above the resistance band of 5830-5870, Nifty has a strong previous overhead supply zone at 5930-5970. Nifty's inability to firmly cross the first resistance band will be taken as a sign of weakness and therefore, one may create shorts in Nifty near these levels with a small stop loss near 5890 levels.
SHORT NIFTY IN ZONE OF 5830 - 5870 WITH SL AT 5897
Levels to watch : 5650, 5710 & 5830, 5870
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