Nifty may turn bullish as it closes above 50DMA & 200DMA

The Ukraine-Russia peace talks achieved progress towards the end of the war. The global markets cheered the probability of these peace efforts. The Nifty closed with 311.70 points or a 1.84 per cent gain and settled at 17287.70. During the week, the benchmark index gained over 650 points during the last week. The Fin Nifty, Energy, and the Auto indices are the top gainers with over 2 per cent. Only the Nifty IT index closed with a 0.24 per cent decline. All the other indices up by over a percentage gain. The India VIX further declined by 6.25 per cent. The market breadth is positive as 1366 advances and 706 declines. About 45 stocks hit a new 52-week high and 139 stocks traded in the upper circuit. Infosys, Reliance and HDFC are the top trading counters today.

With the easing of geopolitical tensions, the benchmark indices closed higher with big bang gains during the last four trading sessions. The index has retraced 61.8 per cent of the prior downfall. The prior retracements also limited to 61.8 per cent levels. Let us wait for this time to cross this level of 17327 on a closing basis. The Nifty closed above all short and long-term moving averages. It decisively closed above the 50DMA and 200DMA, and with this the market status has changed to the uptrend.

Even today, most of the short positions were squeezed. On a highly positive closing day, the Open Interest has declined by 0.84 per cent. The Bank Nifty's, Open Interest also declined by 5.71 per cent. During the last eight trading sessions, the Nifty went up by 1615 points or 10.30 per cent. The index also closed above the 40-week average. All the technical parameters show the most bullish bias, but the volume and Open Interest data don't show any internal strength. Let us follow the trend as long as it trades above the prior day's low.

(The author is Chief Mentor, Indus School of Technical Analysis, Financial Journalist, Technical Analyst, Trainer and Family Fund Manager)