Finally, it seems a short-term bottom is in place today!
Nifty gapped down at 11218 to make a low at 11185 before recovering smartly by the end of the day helped by heavyweights Reliance, Cipla, Sun pharma, and Bharti Airtel to finally settle at 11278 or 39.35 points lower.
Here are my observations of the daily chart of the Nifty.
- Nifty has formed a positive candle (Close > Open) at the lower end of the pennant like formation and the minor support I mentioned yesterday at 11178.
- Just like yesterday, Nifty was unable to surpass the falling trendline, it today failed to close down below the lower trendline. The probability of going in the opposite direction of the failed breakout is much higher!
- Although Nifty ended below 11300, it is oversold going into Thursday and we can expect a rally up to 11437-11507 zone over the next one or two days!
- You’d do better to keep in mind that the trend has not changed from bearish to bullish. I am only expecting a brief rally from oversold levels. The trend will only change if we are able to cross 11800 which in my opinion looks unlikely.
Nifty Bank also recovered some lost ground and closed just under the rising trendline at 22267. Nifty Bank is extremely oversold and a bounce is expected up to around 23000.
There’s also going to be a lot of action tomorrow as the Supreme Court will decide the fate of the debt moratorium and there’s also weekly expiry.
Here’s the list of potential stocks for tomorrow’s trading as per my Swing Trading Strategy. You may decide to enter at 2-3% below today’s close.
I have following positions open from today and yesterday.
Out of these seven positions, HINDALCO, TATA POWER, and NMDC have triggered exit which I’ll be looking to sell tomorrow at open.
Let’s how the remaining positions perform over the next few days! Do check out the real-time performance of my strategies updated every week.
Have a great day ahead!
*** This is not an investment advice and only for information and educational purposes.