Most Bullish news led Strong Rally require Confirmation
Technical Analysis and Market Outlook
(16-01-2015)
Nifty-EOD Chart (15-Jan-2015):- |
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1- 'Pennant Pattern'formations in last 28 Sessions Correction
Conclusions from EOD chart analysis
28 Sessions Correction was seen within 'Pennant Pattern' and its upward line was broken out forcefully and got intraday support also on it today but on the back of most Bullish news of RBI repo rates cut therefore sustaining above it should be firstly watched for on going correction completion after break out of 'Pennant Pattern'.
As today strong moves were on the back of most Bullish news therefore Waves will be recounted according to sustainability at higher levels and will be updated accordingly in the coming sessions's Outlooks
Nifty-Intra Day Chart (15-Jan-2015):-
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1- Consolidation Patterns between 8400-8437
2- Last 3 hours range(8469-8527) broken down after higher levels Profit Booking
3- Whole day actual trading between 8381-8527
Conclusions from intra day chart analysis
Although good selling in last 2 sessions and correction continuation was expected also but RBI cuts repo rates by 25 basis points a fortnight ahead of the scheduled date of monetary policy announcement on February 3. As RBI has been keeping the benchmark interest rate at elevated level at 8 per cent since January 2014 therefore this news most happily surprised and huge gap up opening seen today. As Bull markets consolidate at higher levels also therefore Nifty consolidated firstly because selling was seen in previous sessions.
Last 3 hours trading between 8469-8527 and this range broken down therefore higher levels Profit Booking will be considered and firstly sustaining above today highest should be watched for next up moves confirmations.
Conclusions (After Putting All Studies Together)
All trends are up and Indian markets are most Bullish but corrections are technical requirements which is being seen for the last 29 sessions. As correction was within Pennant Pattern formations therefore its importance was updated on 12-01-2015 in "Nifty will give First Strong Indication of Next Big Moves from Pennant Pattern Break Out".
Although Waves structure was suggesting more down moves but Pennant was forcefully broken out today. As whole day trading of today was Most Bullish news led therefore firstly sustaining beyond following levels should be watched in the coming sessions for:-
1- Next strong rally after correction completion above 8527 because last 3 hours selling below it
2- For correction continuation towards and below 7961 because Nifty got supports exactly at upper line on 8381 and its broken down will mean most Bullish news led false break out