Nifty trend and stocks in action on September 30, 2020

Continuing with its positive momentum from the last couple of sessions, Nifty kicked off the session with a gap-up and went onto register an intraday high of 11,305. With this, it retraced almost 61.8 per cent of the recent down move. Thereafter, the story on D-Street resembles Jack & Jill, the protagonists of the famous nursery rhyme with the same name. As the index went up the hill in the initial part of the session, it failed to capitalise on the initial gains, and in the latter part of the session, it came tumbling down to end the session down by nearly 83 points from its high.

The price action of the day formed a bearish candle with a lower shadow but maintained its rhythm of higher high and higher low as compared to its prior bar. As we had mentioned about the stiff resistance zone in our previous write-up, Nifty resisted around the level mentioned in line with our expectations. Going forward, the level of 11,305 is likely to act as a stiff resistance and until & unless Nifty sustains above this level, do not expect a run-away rise in the index. On the downside, the level of 11,140, followed by 11,080, is likely to act as a support.

On the lower timeframe i.e. the 60-minute, the RSI failed to cross the 60-mark and it turned down from there. As per Cardwell’s range shift rules, the security which is under the influence of bears, the level of 60-65 works as a resistance for it. 

Overall, traders need to be cautious about the long positions unless the resistance level of 11,305 is taken out on the upside.  

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