Nifty in the decider range of 5720-5950 with immediate support near 5820/30 - Wallfort Financial Services

NIFTY has constantly been getting resisted at 138.2% Fibonacci Extension mark placed at 5950. On weekly cards three consecutive weekly DOJIs are formed indicating indecisive action near the mentioned mark. Also, since Nifty has made a bottom near 4770, it has been moving up in a channel form, which at this stage shows a support near 5720/25 levels. This shows that until the band 5700/5950 gets breached on either sides, we can not see any directional action, but we are likely to see 200/250 pts directional action once this range gets breached.

On medium term time frame Bank-nifty is clearly in uptrend and has been trading in clear parallel channel since more than a year. Short term action is also in a uptrend, but has formed a rising wedge with negative divergence in overbought region which is a sign to take profits and stay away from the counters. For extension in current rising action, BN must move above 12800/900 range. Any action above this will only allow BN to test channel's upper end currently placed near 13600/700 zone. On the other side, resisted action in the range 12500-900 and a move below 11900-12000 can turn the short term trend down and force BN to test back crucial supports on the downside to keep medium term trend up. On indicators RSI has a triangular move having support near 50/55 region. Any action below the same will be a negative sign for BN. For now one must stay away and be watchful on mentioned support resistance ranges.

Since the last 2 years, CNX-IT index has been trading in a symmetrical triangle form. Current short term action has formed a small falling channel. Decider range for now has reduced to 5650/70 to 6290/6400. Below 5650 index can tank towards 5400 and below 5400 it can go for testing important support near 5000 levels. Similarly action above 6290/6400, stock can move towards testing 6650/6810 (crucial resistance band).

Source : Equity Bulls

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