The Nifty witnessed profit-booking above 3,400 levels, but closed with 40 points gains at 3,382 on buying in key index heavyweights such as Reliance Industries (RIL), ICICI Bank, State Bank of India (SBI) and Tata Steel. The Nifty is now expected to target 200DMA (daily moving average) of 3,445 and this may happen this week.
The Nifty has been making higher highs and higher lows in the last three trading days, which indicates that the current rally is likely to sustain. The start of an uptrend is signalled when the index makes a higher low, followed by a rally above the previous high.
The Nifty made a high of 3,357 and a low of 3,149 on April 8, and on April 9 the index made a high of 3,401 and low of 3,307. Today, the Nifty made an intraday high of 3,418 and low of 3,334. A bull trend is identified by a series of rallies where each rally exceeds the highest point of the previous rally.
The intraday short-covering in the Nifty April futures in the last three trading sessions suggests further up move for the index in the near future. The Nifty April futures closed with a premium of 8 points and shed an open interest (OI) of over 2 million shares intraday, indicating short-covering by bear operators.
