NIFTY - Bulls in China Shop?

17. Aug. 2022

Nifty bulls coming back after long week end, continue to power higher. The rotation has been classic. The question that demands an answer is in average or below volume, the rise now reaching to the over bought zones last seen in Sep 21. Remember, the actual move down unfolded 30 days later with a further rise of another 2% before the eventual fall. Are we in that zone now?. It is clear incrementally the up-move needs further overseas positive clues and the movements in dollar. SPX hit near the 200 DMA and classical 61.8% resistance zone. There are calls to flag this move as bear market rally. Else where in China, the rate cuts have not been of any help and the economic landscape at best mixed at worst worrying. So clearly bulls are not in China that looks to be a good news else where. Caution remains for incremental longs or the existing longs as we approach a zone of extreme over bought reading. Supply comes in 17880-17930-18000. Support 17770, 17720,17680. A direct break below 17500 is needed for bears to sneak in else it remains a corrective move as of now. Rise towards 17850 plus to be sold with stops 17940-980 zone aggressive tad above 18000 for move to 17500.