Technical Analysis

WHAT LIES AHEAD : NEAR-TERM PICTURE 

SPOT NIFTY : The Nifty tested the previous swing high but was unsuccessful to close above it. During the last 30 minutes of trade, the index declined by 108 points due to profit booking at the swing high. It closed below the 50 per cent retracement level of the day's move, forming a shooting star like candle. The profit booking came mainly from the banking stocks. It moved out of the Bollinger bands and back into the bands at the end of the day. The Volumes were lower than the previous day. As the Index closed above the previous day's high, it negated the hanging man candle implications. Now, the 20 DMA flattened, indicating the pause in the downtrend. It took 15 days to erase the previous sharp fall in just six days. The strong bull candle indicates regained strength in the trend. During the last 15 days, the declines were limited to just 2 days.