Nifty has produced a counter trend relief rally as it was discussed in the morning update and expected since last week. The indice rallied close to 100 points and struck intraday highs at 8737 spot levels, before pulling back lower again. One could keep selling rallies and trade towards the intermediary trend which seems lower from here. Bears are expected to remain in control at least till 8840/50 spot resistance remains intact. Please also keep in mind that is Nifty holds todays’ highs, it could hit the next downside target at 8400 straight. 8840/50 holds key to short term trade setups.
On the other hand, USDINR dropped to 62.65 levels as it was expected and discussed in the morning update. The pair has hit support (fibonacci 0.618), and is expected to bounce back higher from here. Immediate upside potential is seen at 63.35 spot levels. Bulls are poised to remain under control till prices stay above 62.40 support.