In my previous update we wrote Trade cautiously towards short side for the target of 5800-5750 with stop at 5950 on the closing basis.
Yesterday Graveyard Doji pattern formed but today's does not seen follow up action. A follow-up action confirms a reversal if prices manage to close above the high of the Doji pattern which is near 5755. In last 6 days of fall we seen some supporting activity near 5675 zone on the chart in last two days activity but price did not sustain above 5800 also and fell sharply, it indicate sideways consolidation. As two chart shown below, currently two scenario are possible.
In scenario 1
If scenario 1 is valid than price should not go above 5810-5850 level price above 5810 may kiss 5850 level and should turn down towards 5200.
In scenario 2
If price goes above 5850 than expect nifty jump up to 5950 and expect a flat correction. The entire fall from 6093 took 6 days so expect nifty will spend 6 days sideways action between 5675 to 5950. after that again down move should start towards the low around 5484 level.
During such case the stocks which are extremely oversold might show some pullback and the other stocks continue to correct so that momentum indicators come in overbought zone.
In short next four days sideways consolidation is expected and any jump towards 5850-5950 on nifty would be shorting opportunity for 5483 near term target.
Enjoy......................
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