Nifty Outlook for 08-01-2013
Nifty restricted its trade below 6040 levels and closed in negative on 2nd day of week. After gap up opening at 6042 levels Nifty could not maintain the gain on back of weak Asian cues and slipped down below 6000 mark. Finally, remaining in selling pressure throughout the day, Nifty ended lower by 28 point at 5988 levels.
On daily chart, Nifty has formed a powerful bearish “Engulfing line” pattern against yesterdays green “in neck line” pattern. It also has arrested below upper line of conical shape trend line (represent in blue line). It indicates weakness in the trend. In this kind of scenario, the levels of 6010 which is acting as important resistance level for the day as 50% correction levels of bearish “Engulfing” pattern, remains important level to watch. In case, if Nifty fails to hold 6010 and remains below 5990 levels then we will see further correction in Nifty. In that case, Nifty’s possibility of violating 2nd rising gap of 5960 levels and 1st rising gap of 5920 levels will an not be ruled out. On the other hand, if Nifty succeeds to hold 5990 and sustain above 6010 levels then will see continuation in uptrend in coming session i.e. above 6040 levels will lead 6080 levels. For the day, 5960 will act strong support levels while 6010 will act as strong resistance levels.
The level of 5960 will act as trend decider level for the day. A sustainable move above this level will lead in pullback around 6010 levels in Nifty. However, failure to trade above this level will lead further fall around 5920 levels.
Support :- 1) 5960 2) 5920
Resistance :- 1) 6010 2) 6050