Today the fight continued between the Villain and the Hero. We saw a positive to flat opening and it was expected that we will follow global peers and move on but villain i.e., Bearish engulfing had a role to play and we saw sell-off in first hour breaking confidence in the street but the hero fought back we saw sharp recover to 0 level by 12pm. From the derivative side we had witnessed highest volume trading on 7000 CE and 7000 PE which acted as level of pivot till 1:30pm. But than we saw a great recovery in the market after Europe opened up positive and traded 1%+. Technically, PSU banks read the short covering as they already showed positive divergence since last few days. We managed to close above 7050 which was acting as a minor resistance on the option writers side today. So Hammer to fight bearish Engulfing which fought morning star pattern has been formed..pretty confusing ..huh?.. Yes..Nifty charts are still confusing for some clear trend. Levels of Confirmation remains the same as yesterday which is 7204 on upside and 6870 on downside.
Though title indicates a Bollywood post but its not! The post is surely about equity markets but somehow today’s move on Nifty relates to this Bollywood title. Mondays move had given a birth to a hope of strong reversal for long traders and it was confirmed with a Bullish candle opening above Fridays candle and confirming “Morning star” pattern as Circle Green in the attached chart. But today entered a villain in the chart and it gave a “bearish engulfing” with the help of yesterdays chart, souring the relationship of a “Morning star”pattern. Now situation is exactly same as a one gal with a married guy and extra marital. She is confused with whom so should live further and the case is registered in the court. Hearing is tomorrow and we should be clear of her move further. Today markets also resisted near the trend line which was acting as a strong support previously around 7204. So now traders should be cautious tomorrow and wait for clear close above either 7204 which is high of “Bearish Engulfing” or below 6869 which is the low of “morning star”. So all the positions tomorrow should be Hedged!!