Bottom Line: Nifty showed sharp move on upside as soon as the Greece bailout news was announced. Prices are not between important levels of 8560 and 8300.
Nifty daily chart:
In the last update we mentioned that, “In short, Nifty has been moving in range as of now where 8460 followed by 8560 will continue to act as resistance and move below 8300 level will infuse selling pressure. Due to the ongoing event of Greece intraday volatility cannot be ruled out and looking at closing levels will be crucial!”
Nifty showed sharp move on upside along with global markets after the Greece bailout package and managed to close near the upper end of the range at 8460 levels. Prices had a Flat opening and traded in a narrow range till 12 pm but rallied steeply higher towards the important level of 8460 post that. Participation was seen from across the sector in this up move.
Nifty has now again arrived near the crucial upper end of the channel as shown on daily chart. This has opened up a few probable scenarios over short term and today’s action will provide more confirmation if the up move is headed for much higher levels towards the red trendline resistance at 8730 that was providing good support before and should now act as resistance.
As shown on hourly chart, the upside move has opened up the positive possibilities and break above 8560 will indicate deeper upside rally as it will break the channel shown on daily chart decisively. Also this will indicate that the low formed at 8315 was only wave x or an irregular c failure pattern as show as the alternate counts which got completed at 8315 and the next wave on upside has started. A faster move below 8300 is required for negative confirmation.
In short, Nifty is still trading in a range with a clear breakout awaited. Move above 8560 with strong momentum will open up deeper retracement towards 8730 on upside whereas faster move below 8300 is now required for negative possibilities. Let us see if the positive event only resulted into short term spike or a sustained trend for few days!
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