NIFTY

NIFTY

The recovery in nifty has seen nifty heading into a cluster of resistance between 5150-5200.Just like all other major world markets Nifty also has survived a retest of important support between 4800-4700 and has rallied back, during the entire fall nifty had a positive divergence which meant the shorts were always watching the crucial supports and covered up their short position at these crucial supports.

Going forward the 50 DMA will be an important average to watch as in the past it has proved to be a support as well as resistance and whenever nifty has broken past or under it the index has rallied or fell by a good amount. A close above 50 dma will provide more strength to the index and will set it up for a retest of 5300 but a fall from 50 dma will set it up for retest of supports at 5050-5000.

For the short term positional traders please keep a watch on 1000 minute moving average 10-15 point above the average its dangerous to hold short positions and 10-15 points below it longs are dangerous .