As already mentioned yesterday "Nifty is in a narrow "Declining Wedge" pattern which is normally a bullish sign with resistance at 2777, breakout from where will give minimum 65-70 points of Nifty & in the process Nifty will give another bullish breakout which can take Nifty to 2910-2920 in coming sessions. " Nifty, as expected opened on a positive territory & touched an intra day low of 2748 & high of 2853 before closing at 2835 about 85 points above the previous close. Most of the index heavy weight stocks were trading in positive territory supported by Reliance, SBI, Rel. Capital, Tata Steel & many other stocks.
As far as, EST charts are concerned, Nifty gave bullish breakout from "Declining Wedge" pattern as expected & touched the first target of 2850. In the process, Nifty is already set target of 2910 which is likely to be achieved in next couple of sessions. On the other hand, close below 2800 may intensify further decline towards 2500 as mentioned a couple of days back.
Most of the IT, power, infrastructure, banks, financials, steel stocks were among the top gainers where as stocks like Maruti, TCS, Educomp & ONGC are indicating weakness in hourly charts which may bring down the index in a day or so. As far as A/D data is concerned it was in favor of bulls in the ratio of 2:1 with 394 declines & 788 advances during the day.
In nutshell, Nifty achieved its first target of 2850 & now it is placed at crucial breakout level for target of 2910+ which may be achieved. On the other hand, Nifty close below 2800 can once again threaten the EST uptrend resulting target of 2700 & 2500 which may be achieved soon. The best strategy would be to concentrate on stocks which have given bullish breakout in hourly as well as daily charts for next 1-2 days & book profit on stocks which are already overbought & ripe for further decline in EST charts.
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