Outlook for NIFTY for the coming trading sessions

Nifty Daily Chart-Retracement lines

In our last post on NIFTY outlook,we mentioned targets of 6040 and 5980 on the lower side.Continuing the downtrend,Nifty fell in 8 sessions on the trot.Breaching the first support of 6040,Nifty went up to 5975,the next major support.From these levels ,Nifty bounced back and closed above 6050 in the last trading session supported by short covering.

In the entire down move,Nifty lost about 350 points and went into oversold territory.Hence a sharp up move was due.Highest Call Option Open Interest at 6000 strike and strong technical support of 5975-5980 along with positive global markets provided the reason for bounce back.

Nifty-Stochastics & RSI

The 38 % Retracement line of the entire 350 points decline lies at 6114 while 50% Retracement is at 6156 which may act as resistance to the Index on the upside.

In last trading session,FII's bought Index Futures worth ₹ 115 crore and bought Index Options worth ₹ 440 crore which is somewhat positive for the market.Leading Indicators Stochastics and Relative Strength Index ( RSI ) are showing positive crossover on the daily chart.

In the coming sessions,we expect Nifty to trade higher towards 6150.The support is at 5970-5980.So, short-term traders can play Nifty with positive bias near 6000 levels for higher targets of 6150-6200 ( spot levels ).
[ source of images;www.icicidirect.com ]