-> Nifty is now back from overbought zones of 70s RSI to a oversold zone of RSI 30.
-> Last we saw such oversold levels was at 6000 Nifty dip in February.
-> Also a lot of channel supports at 8050-8150 and breakout points.
-> The last bottom is at 7730. The medium to long term trend remains positive till we stay above it.
-> In the near term we may expect a bottoming out at 8050-8150 with a margin of +- 50 points. Possibly we will see positive divergences in coming few sessions.
-> The strategy is to buy around 8050-8150 with an chance of a dip to 7950-8000 also because of some sectoral rotations.
-> Bank Nifty which has been an outperformer can see a dip to 17300-17500 if it sustains below 18000. If that happens a buy on Banks can be initiated in that zone.
-> A bounce back target zone is at 8450-8500.
The markets can be very volatile while making such oversold bottoms and even take time. So if one is looking to buy this dip one needs to be patient and be ready to see some pain too for short time.
This could be a good time for investors sitting on sidelines or even to deploy fresh cash.
P.S: Do note my long term stance is very bullish and ready to digest deep corrections.
