NIFTY Index Chart Analysis

CAUGHT IN A DOWNWARD SPIRAL

Last week, Nifty registered one of its worst declines. It spiralled down by 3.56 per cent in the previous two weeks, closed below the August 31 low and formed a major low. The current fall from the top is to the tune of 6.85 per cent. Now the question is whether it will be limited to Category I (10-13 per cent) correction, or will it extend to Category II (25-30 per cent) correction? After March 2020, all the corrections were limited to 3.84 per cent to 18.39 per cent. Only the fall during October 2021-June 2022 met the Category I correction. All the other corrections were short-lived.