The merry run continues across the globe and it’s been nearly one and half months now, markets are just continuing their gravity defying moves. During last week, our markets started on a flat note but immediately resumed its upward momentum. For the subsequent two trading sessions, the rally continued and in the process, Nifty kept posting new record highs one after another. The similar sort of one sided move was missing in the latter half of the week as markets saw some volatile swings to test the 13350 mark. Eventually, due to late recovery on both the occasions, Nifty managed to close tad above 13500 on Friday with weekly gains of nearly 2%.
Our markets is near to reach yet another milestone of 13600 with ease and few heavyweight themes did well to guide markets at new record highs. Since we are trading in an uncharted territory, sky's the limit for our market; but in our sense, we have now reached the extreme zone, at least for the current vertical move. With a broader view, 13800 and beyond levels are very much possible, but for a time being; 13600 – 13700 are the extreme levels as per few key Fibonacci ratios. Let's see why these levels are considered important. The 'Golden Ratio' (161%) on the 'Price Extension' of the recent previous up move is placed at current levels. This level coincides with the 200% ‘Price Extension’ of the first up leg from March lows. More importantly, if we connect all important highs from March 2015 on the monthly chart, we can see a 'Multi-year Upward Sloping Trend Line' precisely converging around the same levels. Hence, some cooling off around this crucial junction cannot be ruled out.
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