Nifty opened huge gap up today at 8084 but didn’t sustain at higher levels and decline sharply till 8048 in first hour of trade. Nifty started recovering again to touch day’s high of 8136 till EOD followed by sharp decline before closing 44 points up at 8091.
Nifty achieved the levels near 8149 without breaking below 8019 as I mentioned yesterday. Let’s have a look on latest chart.
This is 5 minutes time bar chart of Nifty showing move after Friday’s low 7940. It seems wave (A or 1) completed from 7940-8034, wave (B or 2) is completed from 8034-7952 as Irregular Correction and (C or 3) is in progress.
Within wave (C or 3), again it seems inner wave (iii) is completed at 8092 followed by progress of wave (iv) as irregular correction. We can see levels above 8136 again after completion of wave (iv). 23% and 38% retracement for wave (iv) is placed at 8058 and 8038 respectively. So, Nifty can bounce again from 8058-8038 range.
Nifty charts are suggesting some decline, may be till 8058-8038 range followed by a bounce above 8136 again. The strategy should be “Buy on Dips” with stop loss for short term. Stop loss for existing longs should be some points below 8038 which is 38% retracement of wave (iii).