Nifty : Small Correction impending

After a range bound and lacklustre day, lets take a look at Nifty's Chart. It has been a dull day where nifty moved from 4780 to 4825 just biding time for the next move. Looking at the internals, Reliance was the only stock which added some significant points to Nifty, else we would had a negative closing. As I pointed out in a previous post, seems there has been a breakout in Reliance yesterday and today also it followed up with some nice move. But this nearly 8% jump in 2 days will attract some profit booking sooner than later.

In the charts we see that the momentum is dying down, and with not much support from the global markets, profit booking can be expected. We still have not seen any convincing break of the 4790 fibonacci resistance.

So the levels I would watch would be 5day EMA which comes near 4760, a negative sentiment day can take us to 13day EMA of 4690.

Ideal strategy would be to buy on dips, as we are in an uptrend.