Nifty is trading above its three major simple moving averages 20 - DMA, 50 - DMA and 200 - DMA, placed between 10,830 & 10,870. This suggests a validated up move is in progress and strong support exists on the lower side
Nifty traded with +ive bias throughout the last week and managed to close above major hurdle of 10,985. It has also closed above the level of 11,000.
The recent rally was supported by PSU banks, auto and metal sector. Bullish crossover in MACD indicates +ivety in Nifty; an increasing histogram of MACD on the daily chart is also indicating bullishness in the index.
The market has given the highest weekly closing since Oct- 2018 suggesting bulls have upper hand in the current rally, also RSI has given breakout after 4 months.
Interestingly, the index is trading above its three major simple moving averages 20 - DMA, 50 - DMA and 200 - DMA that are placed between 10,830 and 10,870. This suggests a validated up move is in progress and strong support exists on the lower side. Middle regression line of linear regression channel is also placed around 10,875.
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Sustained trade above previous months’ high placed around 11,118 will accelerate the up move, which can take the index higher towards crucial resistance zone of 11,250 -11,300. However, the majority of the short-term oscillators are in an overbought zone that can lead to some profit booking. Moreover, a close below the strong support (10,870) will push prices lower towards 10,750.
Bank Nifty: Banking index is trading above all its major important moving averages justifying uptrend is in progress. Recently, Bank Nifty has given a symmetrical triangle breakout around 27,350, which can push prices higher towards 28,300.
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