Triangle . . .

Hi All,

For  consecutive 2 days Nifty has given positive closes above 1%, which is a good sign for bulls. On daily charts, Nifty has created a higher high around 7215 levels near  resistance level of 7210-7230 which is used couple of times which as per theory means that the same has become weak and is likely to be taken out, , however as mentioned yesterday 7210-7230 is a resistance area, and it is advisable to wait for it to surpass.

Above 7210-30 next pit stop for Nifty can be 7280-7330-7370.

On lower side, after a strong pull back of around 1%, the level of 7100-7120 will be very important to watch out for and if Nifty goes below it next supports can be near 7070-7000-6950 and finally 6850.

On hourly charts Nifty is making a Ascending Triangle like pattern, which will see a break out above the resistance levels of 7210-7230…. On the lower side the triangle trend line support will be near 7100-7020 levels.

If Nifty has to bounce back it should ideally hold on to the 7000-7100 levels, else a further down side can be expected.

Daily chart now shows a higher top higher bottom formation, though not a convincing one, and therefore its advisable to wait for a break above 7110-7130 levels. An hourly close above the said levels can mean a lot for bulls, and bears will take a step back.

The India Vix (Volatility) settled yester with a loss of 150 basis points and settled near 21.30% mark, and in order to allow markets to go even higher from now on, India Vix should not cross 22.30-22.50% mark.

So, in a nutshell, key levels to watch out for intraday today will be 7210-7230 on the up side and 7120-7100-7050-7000 on the lower side, since Nifty theoretically created a higher top on daily charts the bias will continue to be bullish and buy on declines near supports will be advised, provided we get some bullish confirmation on 115 minutes / hourly charts.

Cheers