By Aditya Agarwal
After confirming its breakout from ‘downward sloping’ trend line channel, Nifty has seen a decent traction and precisely retested its previous swing high of 10,479.
Now, the daily RSI (14) is approaching towards 60 levels whereas the hourly chart signals multiple bearish divergences. On the weekly line chart, the previous bottom of 10,455 (weekly closing of February 9, 2018) may act as an immediate hurdle.
Any sustainable move above 10,500 will drive the index higher towards its crucial resistance of 10,630. On the flip side, 10,355 and 10,290 are near-term support for Nifty50.
The options data is indicating a rangebound move for Nifty in the short-term. The maximum call concentration is placed at 10,500 which indicates a stiff resistance whereas on the lower side, put writing was seen at 10,300 which will act a strong support zone for indices.
Overall, we expect Nifty50 will continue to consolidate in a broad range of 10,300-10,500 for the next few trading sessions before giving any fresh breakout on either side.
Hence, we advise traders to go short in a range of Rs 603 to Rs 608 with a price target of Rs 550. A stop loss should be placed above Rs 630.
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