Nifty Detailed View:
Last time when we talked about Multiple Support Zone -->> 5550 to 5650 ( refer post on 11 th Jan ) , Nifty took 3 times support from this support zone before breaking it finally.
Now after correcting almost 1000 points from the Top the view is given below ( attached with a chart ):
5350-5150 --> It wont be a easy task for Bears to break this support zone because of the following reasons:
1) Multiple bottom formations around 5350 during July - Sept 2010
2) Solid Trendline support ( lower end of the long term channel ) @ 5150-5200 joining major bottoms formed in Nov 2009 , Feb 2010, May 2010.
3) Minor support around 5200-5300 as Nifty consolidated in this range in the month of June -July 2010 before finally giving a breakout.
A bounce is for sure from the Multiple support rectangle but it is difficult to say this bounce will turn into a Major Bottom or it will be retested again ??
If this support zone ( 5150-5350 ) is broken on closing then expect Nifty to go back from where it started to 4800-4900 which is 61.8% level of the entire rally from 2500 to 6300.
Trade Wisely
Regards
Ankit
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