After closing above 8666 – 8680 resistance zone for two
trading days; Nifty enters into a profit booking mode. Is this merely a profit
booking or correction is in place? Well the speculators seems to be confident
that the correction is in place. Looking at the Nifty Futures data; we found
unwinding of long positions and built up in short positions; though this seems
to confirm Nifty is entering into correction zone; this data is unreliable. The
reason is during the past we have witnessed drastic changes in this data
turning positive-negative and vice versa so fast. Along with this on the technical
chart, we find many support in place to be tested before Nifty confirms the
correction. If support promises to hold, this on-going profit booking would
merely be an opportunity to enter long and the over heatedness that we found in
Nifty would be cooled off; providing Nifty the room to move higher. We shall
confirm correction once Nifty closes below 8475. If confirmed, Nifty would move
towards 7780 – 7850.
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