Nifty index to continue rally, may retest lifetime highs
From the present structure of the charts, though there may be a likelihood of some minor consolidation at higher levels, Nifty option has set a stage to move towards its lifetime highs again.
We expect a positive start on Wednesday, and are likely to see the Nifty extending its upmove with some possibilities of minor consolidation happening at the higher levels.
Wednesday is likely to see the levels of 10,985 and 11,150 acting as resistance area for the Nifty. Supports may come in at 10,850 and 10,800 zones.
The Relative Strength Index (RSI) on the daily chart is 63.32, and it has marked its fresh 14-period high, which is bullish. The daily MACD stays bullish while trading above its signal line. On the candles, a Rising Window occurred. It is essentially a gap and usually transforms into continuation of the upmove.
The pattern analysis confirms that the Nifty has broken on the upside of a symmetrical triangle formation and has broken out above the resistance of the falling trend line and has created a stage an upmove ahead.
Overall, the Nifty has closed above the upper Bollinger band and this signals continuation of the present rally. Though some pullback inside the band and some minor consolidation is likely, the overall stage is set for the Nifty is to move near its lifetime high once again.
We continue to recommend using each consolidation that the market to make fresh purchases. Overall, a positive outlook is advised for the day.
