Nifty View: As expected today’s 100 points sell-off from the benchmark Nifty index has lead to an “Evening Star” pattern on the daily time frame. This three candlestick pattern is bearish and suggests further price weakness. A confirmation of this will come once the price breaks below today’s low of 15,766. Do not get too carried away with this bearishness as the index is still in a strong UP trend and these candlestick patterns are prone to failures. Having said this, keeping in mind the nature of today’s sell-off (especially in the final 30mins), an extension on the downside is very much likely for a test of 15,700 or further down. We will get a much clearer and confirmed picture once today’s low gets compromised. Till then it’ll be prudent to stay cautious (as advised since the past few sessions) and wait for better opportunities.
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