Nifty Future made a low 10431 within first few minutes of open to complete its 3-wave down correction as shown in the 60-min chart. These corrective waves were of almost equal length in price and the crossing of important support level of 10473 for this week was the clue that the bottom is in place for the day and is moving towards its projected target of 10553.
It has multiple supports at 10525,10490,10472 and 10431 and resistance at 10567 and 10605.With the Stochastic oscillator on the daily chart in an overbought range and RSI near 62, the probability of this rally to fizzle out near 10605-10620 range looks very high.
The positional traders holding a long position can book profit near 10605 and wait for the next opportunity to emerge.
The Day traders can buy it above 10525 with a stop loss of 10488 for the target of 10563 and 10605.Short selling can be done only below 10431 with the stop loss 10476 for the target of 10379.
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