Dated :- 27.06.2013  (Thursday)           NIFTY  :   5682.35

Hi,

Readers,

The Nifty has behaved exactly as was mentioned in my previous blog on June 22, 2013. In which it was mentioned that Nifty shall take support at 5600 around level and rebound is expected from these levels. Here are the quotes of my previous blog: “This 5600 around level will further provide support to Nifty on immediate basis and a rebound is also expected from these levels”.

For all trading days after my blog Nifty gave close around that 5600 level (Nifty closed at 5590 on 24^th June, at 5609 on 25^th June, 5588 on 26^th June) and today Nifty ultimately rebounded after taking support as was mentioned in the last blog and closed at 5682.

There were positive divergences in both hourly and daily charts and today Nifty gave an upper breakout above 5666 of very short term reversal pattern and this pattern if holds, has the potential of giving further steam to this rebound and can take Nifty to some more higher levels on the back of short covering.

Although Nifty gave breakout of very short term reversal pattern today, one should not get carried away with this. Keep in mind that overall trend is down. This is contra trend move and should be played with strict stop loss keeping in mind that the downtrend can resume.

Technical analysis say that overall trend always has more power and overall trend of market holds till it is not reversed. All the counter trend moves are only contra trend moves till they become so powerful to reverse the trend and once they reverse the trend, those contra trend moves take the shape of a trend.

Trade accordingly and enjoy the profits.