In the last article we discussed about how the support and resistance zone created by nifty is a illusion as you are not the only one to watch those zones probably tonnes of all your trading competitors are watching this zones and placing their stops accordingly.
If you are placing your stops where most of the people place their stops then a common phenomenon occurs frequently in the market to remove weaker hands from the market called stop hunting to eliminate the weaker players from the market.
If you closely look into the EOD charts of nifty futures you would noticed since August 2016 we had made almost 7 attempts to safeguard 8580 zone. Every time the price went below 8580 zone some buyers shown interest and pulled the price towards the upside. And todays nifty movement is the 7th failed attempt to close below 8580 zone. Clearly 8580 zone is a go or no go zone for bears. Any strong acceptance below 8580 could seriously drag the price lower further.
However at this point buyers are keen on holding on the 8580 level on EOD basis though intraday whips occurred around that zone. Any further pullback from this zone could extend towards 8800 zone.