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Nifty 50 is in an Oversold Zone, but...

Sep 27, 2022

The Dow Jones Industrial Average ended in the red overnight. It fell over 1% to hit a new 52-week low. But the Indian share markets started the day on a positive note today.

In my daily Pre-Market video, I highlighted that options writers are indicating a short-covering rally. We are witnessing an addition in the 17,000 PE options chain and the 17,100 PE options chain in the first 30 minutes.

chart

The technical structure says the bulls are falling at the first hurdle.

Nifty 50 Technical Chart

 

1. The breakdown of the double-top pattern and previous swing low at 17,166 (marked black Trendline).

2. The 200EMA on a 2-hour chart.

3. The gap area.

Even though the Relative Strength Index (RSI) slope is trending northwards in oversold territory, the price action is being rejected at the confluence of the resistance zone.

We may have a rangebound day till either 16,950 or 17,230 is not taken out.

At present, the Nifty is trading at around 17,020.

If you're interested in being part of my charting journey as I share how to create wealth from the profitable trade setups, join my telegram channel - Fast Profits Daily. You'll get access to the best trading ideas in the stock market.

To know more about how the Nifty and Bank Nifty index are performing, please see the NSE Nifty Live Chart and NSE Bank Nifty long term chart.

Disclaimer: This article is for information purposes only. It is not a stock recommendation and should not be treated as such. Learn more about our recommendation services here...

Brijesh Bhatia

Brijesh Bhatia Research Analyst and expert chartist, is the editor of Alpha Wave Profits. Fully committed to his craft, Brijesh has mastered the art of making money by trading using technical analysis. Brijesh has an MBA from ICFAI and 16 years of experience in India's financial markets. He began his career on Dalal Street as commodities dealer and it wasn't long before he developed his own unique trading system. Brijesh worked on his trading system until it could be expected to deliver 5 units of return for every unit of risk.

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