Huge bounce in Nifty – heading to all time highs?

Nifty has had a huge bounce in the last few days. It has moved almost 900 points in 8 days. In September, in 4 weeks, Nifty fell from 11800 to 10800. In October, in 8 days, Nifty has shot up from 10800 to 11650.

But what next for Nifty? See the chart above. Nifty has been trading in a neat channel from the March lows. It is still in the channel and bounced from the lower channel. It is heading upwards in gaps. There are many shorts in the system from this fall. So there is a good chance that this momentum takes it to the top of the channel to fresh highs. Nifty can very well head to all time highs. Of course there can be volatility and it wont be straight line. But the direction is up.

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