Nifty 04 Feb’21: Fractal Divergences

Thanks to banking stocks and especially SBIN, the benchmark Nifty posts fourth consecutive positive daily close. Targets/ resistances from one of the rising channel's upper border at 14,900 is now taken care and if this kind of momentum continues then we should be headed towards (15,200-15,300). But there is a little element of caution we should pay attention to. A negative price-momentum divergence on the daily and 75min chart of Nifty at the current juncture. Such divergences generally indicate some consolidation or slow down going ahead and not necessarily a reversal. Considering the momentum with which we had this rally, I sense that the index will face some profit taking/ consolidation on the last trading session of the week.

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