At the point we can not definitely say whether Nifty is bullish or bearish. As I will explain below shortly. So we need to explore both bullish as well as a bearish scenarios.
Bullish Scenario:
In the Nifty Spot Chart I have drawn two channels one in Brown which starts from some times in Aug 2015 and another in sky blue color which starts from some times in Oct 2015 and Nifty has broken the upper channel resistance lines of both of them.Which is extremely positive for a Bull market.
As Nifty is out of the falling trend channel lines, can easily target 8650 in near future though may not go in a straight line. But through multiple resistances at different levels. The immediate 1st resistance in this case can be 7900 and then 7972 as can be seen from the stock chart. If we successfully concur this resistance zone then next resistance will come at 8323, 8650 and ultimately all time high 9119 respectively. The support levels lies at around 7713, 7577 and 7518.
But again we need to be on high alert if any thing suddenly gets changed we should be in a position to reverse our position without any doubts.
Bearish Scenario:
We are still in a falling channel which started from Mar 2015, the blue channel. The ONLY resistance in this channel for this week is at around 7900 and will move lower as the time passes. But this is a huge resistance and if Nifty is unable to cross this resistance level will sell off immediately and also with high magnitude. If this happens then Nifty can fall all along to 7518 initially and then even upto 7000 odd levels. But it is too early to go with that scenario. Anyway trade with high alert and as my master Ilango Sir says, "Get Rich Slowly & Quietly". Here is a link to his posts.
Trade safe and keep checking this space for any updates on developing resistances in between.
Also check out our other publications on Nifty, Bank-nifty and stock specific at the left hand column. Cheers!!
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