Nifty has made a bottom at 5984, via bullish hammer appeared on 200 day SMA support, preceding long black candle, thereafter gave a sharp rally to the level of 6562, it then went into brief consolidation , in the form of bullish horizontal flag, or pennant having horizontal up-line and up-slanting down -line. In Consolidation phase ,the size of White Real bodies [ Bullish belt hold, Long white real bodies, with no shadows or insignificant shadows]are comparatively greater than the Black Candles[ Small real bodies], signalling bulls are riding the rally and bears are lagging behind. Thus in case , if pattern completes nifty may see a level of 7000.
INDICATORS:
Volume : Diminished in the consolidation phase and picked -up on the breakout.
Bollinger Bands : Are widening, signifying the strength of the upward rally.
RSI : Reading over 70 is also showing strength in upside momentum, though considered as overbought reading.
ROC : The indicator is also turning -up.
MACD: Reading over 70 is showing strength in upside momentum.
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