Monday, January 30, 2012

Nifty Outlook Monday Jan 30

NSE Nifty moved in a range of nearly 200 points and ended with a gain of over three per cent at 5,205.
The Nifty has closed bang on its 200-day daily moving average (DMA). The index has not been able to close above its 200-day DMA since early May 2011. Given the positive momentum indicators, it seems set to cross this psychological level for now.
However, going ahead, the index is likely to face considerable resistance around 5,250 - which is the 50-WMA (weekly moving average). Above which, this uptrend could face another major resistance around 5,370, the higher end of the Bollinger Band on the weekly charts.
In the near term, the markets may now turn choppy, given the near overhead resistance (5,250) and overbought conditions on the daily charts (RSI is above 75 per cent). The wide consolidation range for the Nifty could be 5,250-4,950.
Next week, the index could face resistance around 5,280-5,325, while seeking support around 5,130-5,080.

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