Nifty gains over 1% on foreign funds  buying, GST hopes

By: | Updated: July 25, 2016 7:50 PM

Tracking slightly higher Asian market sentiment Nifty opened flat in first trading day of the week.

bse sensex nse nifty rupeeImportant support is at 8480 and only a move below this level trader should book partial profit from the existing long position and should re-enter around 8350-8370. (Photo: AP)

Tracking slightly higher Asian market sentiment Nifty opened flat in first trading day of the week. However, market gained momentum tracking domestic cues, liquidity from foreign fund and with the expectation that major bills is likely to get approval in the parliament lifted sentiment to post a new 52 week. The 50-share index closed 94.45 points up at 8,635 on Monday.

The long real body in daily Nifty candle stick chart pattern indicating presence of strong buying. This is extremely bullish pattern, indicates the present up trend is likely to continue due to interested buyer even at higher level. The breakout of the range between 8500-8600 was the key for today’s trading session. Going forward market is expected to move much higher if it manages to hold above the breakout level of 8600.

Momentum indicators although slightly overbought, no signal yet visible, indicating market is topping out. Medium term trend rating is still very strong as long as market remained above 8350.In its longer time chart MACD indicator the signal line, MACD line and histogram are all trading above the zero line indicating medium term up trend.

Important support is at 8480 and only a move below this level trader should book partial profit from the existing long position and should re-enter around 8350-8370. Medium term up trend is likely to resume around this level and it is very unlikely that market will drop significantly below this level. On the upside resistance around 8700-8740 is likely to offer short term supply.

(The author is founder & CEO, CapitalVia Global Research)

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