India’s NIFTY Index Comes Into Weekly Resistance

Let’s take a look at India’s Nifty-50 Index (^NSEI), which is bumping up against the falling 20 week EMA which could serve as a temporary upper-limit after the astounding 40% (1,000 point) price run-up off the March lows.

Price has rallied 1,000 points into resistance at the falling (yet flattening) 50 week exponential moving average, and a doji has formed on last week’s price action which adds to the potential price pause or beginning of a retracement down that could be expected to form off this level.

I’ve also drawn the large-scale Fibonacci price retracements, and should price manage to break above the 3,500 resistance level, then the next area of confluence resistance comes in at the 3,800 level which reflects the 38.2% Fibonacci retracement along with the 200 week simple moving average.

Otherwise, we see positive chart developments, in the form of a rising 20 week EMA (and price remaining above it) as well as a positive cross-over in the red (trend) line of the 3/10 Oscillator (above the zero-line).  The Black line (3/10 line) is beginning to roll over along with price so if it continues to turn, it will forecast a slight pullback.

Trendwise, price has broken above the prior price resistance levels and so has formed a higher high above the prior three swing highs (from November, December, and February) in a bullish sign of strength - though the trend has not officially turned up (on the weekly chart) yet.

Should price inflect down from here, watch the 3,000 level (or just above via the 20 week EMA) for the first level of support.

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