Nifty bounces back from 7 month low of 5478 - Karvy

The Nifty opened higher and traded sideways in the range of 5490-5520 levels in the wee hours of the session. Thereafter, the Nifty slid lower to post a near seven-month low of 5478 only to quickly bounce higher and traded firm for the rest of the session, amid high volatility. Finally, the Index settled above its resistance 5550 level.

The key oscillators in the hourly chart are pointing upwards and can prompt the Index to test its next resistance of 5600 level in the coming session. Owing to the current medium-term downtrend from January high of 6112 level, the Index is likely to retreat lower honoring this resistance level (5600). However, an emphatic move above its 21-Day EMA near 5630 is required to turn the short-term sentiment positive, which can take the Index towards 5700 and higher.

Among technical indicators, the 14-Day RSI is bouncing higher from the oversold region with a fresh buy signal and the MACD is below its zero-line. This suggests the short-term recovery tone is on cards within the overall downtrend.

Source : Equity Bulls

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