Nifty approaching multiple support levels - AXIS Direct

In last trading session Nifty opened with 34 points down gap and accelerated selling pressure was observed from opening trade throughout the session. Nifty closed at lowest point of trading range at 5852 with huge loss of 91 points or 1.53%.

On the daily chart Nifty has formed a sizable bear candle forming lower High-Low formation indicating bearish bias. With previous session downfall Nifty erased all the earlier three sessions' pullback rally indicates intense selling pressure on pullback rallies. This also implies down trend. Nifty is in downtrend following lower Top and lower Bottom formation. With current close Nifty is approaching towards multiple support zone of 5830-5825 levels which also coincides with its earlier Top (5815) formed on 5th of Oct. 12. This support zone would act as a crucial support in the near term. However a decisive close below this zone would result in breakdown and trigger accelerated selling in the near term. The short term 20 day SMA(5960) and 50 day SMA(5961)levels are sloping downward along with negative crossover which support bearish bias. For the day if Nifty trades below 5840 then it may drift further in the range of 5800-5780 levels. On the upside immediate intraday resistance is placed at 5880 level.

The daily strength indicator RSI has turned negative along with negative crossover which indicates weakness. The daily Stochastic is also in bearish mode supports downside momentum ahead. The trend deciding level for the day is 5870, If NIFTY trades above this level then we may witness a further rally up to 5900-5950-5975 levels. However, if NIFTY trades below 5870 levels then we may see some profit booking initiating in the market, which may correct up to 5825-5795-5745 levels.

Stocks to focus for intraday Long: Hexaware, Wipro, HCL Tech

Stocks to focus for intraday Short: Reliance, JSW Steel, Hindalco, M&M, SBI, Sterlite, Tata motors, Yes Bk

Source : Equity Bulls

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