"The index has to cross 10490 levels decisively to move higher and if it fails to cross this level, weakness could be seen towards 10290 and 10150 levels," says Rajesh Agarwal of AUM Capital.
By Rajesh Agarwal
Benchmark indices trimmed losses and closed marginally lower on Wednesday after banking stocks recovered. Shares fell for a second straight day following a weak trend in Asian equities after US stocks declined as President Donald Trump replaced his secretary of state.
In key economic data released on Wednesday, India's annual wholesale price inflation eased to 2.48 percent in February for the third straight month after touching an eight-month high in November, helped by a softer rise in food and fuel prices.
Nifty has formed 'Hanging Man' followed by 'Shooting Star' candlestick pattern around supply zone of 10450-10490 levels on daily scale. It opened with gap-down but recovered from day's low and closed with loss of 15.95 points.
The index has to cross 10490 levels decisively to move higher and if it fails to cross this level, weakness could be seen towards 10290 and 10150 levels. Furthermore, RSI (14) has given a positive crossover which is a bullish sign.
The index has outperformed benchmarks led by strong short covering rally in PSU & Private banks after-market anticipated that RBI might cut key policy rates by 25 bps in August, which will lead to lending rate cuts, and in turn support growth.
It has formed Bullish candle and closed marginally above its 200 SMA of 24807 levels signifying a rally to continue in near term. But strong hurdle seen around 25100. It has to cross this level decisively to move further higher.
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