Nifty closes at 5682 on short covering at lower level - AXIS Direct

In previous week the benchmark index opened higher and witnessed profit booking at higher levels which drift Nifty lower. The buying momentum coupled with short covering at lower level pulled index higher to close in green. On weekly basis Nifty closed at 5682 with 0.55%.

On the weekly chart Nifty has formed a small bear candle carrying a long lower shadow which indicates buying support at lower levels. In past couple of trading session Nifty has witnessed pullback action at down sloping Trendline support around 5620 levels. With last trading session's close Nifty has gave its eight sessions down sloping Trendline at 5650 on closing basis this suggests positive bias. This support is also coincides with long 200 day SMA value of 5627 which also support bullish bias. However at current level Nifty is placed at immediate resistance of 5700-5720 levels and any sustainable move above this would accelerate further pullback rally in the range of 5775-5818 levels. On the downside major multiple support zone is at 5600-5550 levels. For the week we expect pullback rally to continue and index may trade with positive bias in the range of 5790-5650 levels.

The daily strength indicator RSI and momentum oscillator - Stochastic both are in bullish mode along with positive crossover which supports upside momentum. On the daily chart RSI indicator is placed positive divergence which suggest gaining strength at lower levels.

The trend deciding level for the day is 5660, If NIFTY trades above this level then we may witness a further rally up to 5715-5750-5805 levels. However, if NIFTY trades below 5660 levels then we may see some profit booking initiating in the market, which may correct up to 5625-5590-5570 levels.

Stocks to focus for intraday Long: BOB, BharatForge, Century Text., Cummins Ind., Hindalco, ICICI Bk., ITC, Sesa Goa,

Stocks to focus for intraday Short: Cairn, Glenmark, Heromotoco, Reliance, Sunpharma, Tata Motor

Source : Equity Bulls

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