As we inform last week nifty given a continuous hammer on weekly chart and “POSITIVE CONVERGENCE” on daily chart, and all this resulted into reversal of trend with high volatility.
As we inform last week nifty was moving in channel last week and not it is clearly out from this channel, so this can give us an indication that trend reversal is started now and buying on every dips would give good returns in coming trading days.
As per the CONVERGENCE signal nifty already given a movement from its recent bottom around 5100 level, and if we look clearly, we can see some HNS pattern on longer term chart, where chart has taken a big time to make first shoulder, then it made the head with a top of 6230 level, and after that it made second shoulder, pattern is having height of 730 points and it has broken the neckline at 5650 level and given a down fall till 5120 level which is almost 530 points move. At present after reversal from bottom price has again touched the neckline for the confirmation so as per this pattern coming week is very crucial to decide next journey of the market.
RSI also able to move above its resistance range now and it’s still having scope to move upper side till overbought zone again, so trading according to given levels can give some good opportunities.
For coming week consider 5700-5760 would be a major resistance range, at any point if nifty able to give close above this range then upside we can surly see 5900-6200-6400 levels in coming time, and with this breakout above mention HNS pattern will fail to confirm its down move again.
Down side major support levels for nifty is 5550-5300-5200.
Please note 5700-5760 is major resistance and only closing above this level can give a bigger moves in future time, but if nifty not able to close above given range and able to trade negative for next two trading session then we can see fall in a market till given support level, so as per the chart buying after breakout or buying near support will provide good trading opportunities in coming week.