Nifty Daily chart
Nifty witnessed a Big up day and rallied by more than 130 points. We were not expecting a deep move up and sudden “V” shape recovery across the globe. This exactly proves why Risk Management and Position sizing becomes extremely crucial during such times when markets move wildly in a range. Wave counts are very tricky for now and we might be forming a complex X correction.
We think prices are moving in a triangle pattern since the centre of triangle is most violent with gaps and no clear direction. It is often said to avoid trading a triangle and wild movements like this vindicate the old saying.
For now the short term bias has turned positive as long as today’s gap remains unfilled at 4912. The immediate resistance is now at the big down gap seen at 5060 - 5110. 5060 is also the upper trendline of channel and so it would not be taken out easily.