NiftyOutlook by Epic Research

Nifty forms a Doji pattern after a gap down as global cues drags markets lower. Bears were in full charge across the globe. A tweet that devastated the global sentiments with Chinese and other Asian markets losing almost 4-6%. As US President tweeted about increasing China’s tariff to a whopping 25% from 10% led a turmoil in global markets.

The domestic markets saw a sharp decline with a gap down and Nifty opening and closing the day below 20 Days MA. Nifty has not been below 20 days MA more than 2 days since March starting as the trend is intact on the upside. But this has put some dent on the undertone which was largely in favor of bulls since last few months.

The volatility which was around 23 last week has spiked 28% to 26.5 levels and hit a high of 27.83. This has been the highest level volatility has hit since September 2015. That was about the time when China was seeing concerns over its economy and its health and a possible slowdown.

Nifty is on the verge of a massive event which is LS elections results. This may be a trendsetter but volatility is the spoiler for traders for now. Though with a positive cross of 50 and 100 MA we believe the trend is likely to be positive in the medium term.

Nifty as far as above 11500 may sustain this momentum and also it is an opportunity for traders to enter the trend for the higher target of 11800. A close below 11500 would negate this bullish momentum.

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Posted in: Indian Market Tips