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The Nifty50 during the previous week traded with positive bias and has maintained higher high and higher low in the weekly chart. In the process, it registered a resolute breakout above the falling channel containing the entire corrective price action since mid February 2018 signalling a reversal of the corrective trend and resumption of the positive momentum.In the past two weeks, the index has rallied almost 475 points from the March low (9,952), leading the stochastic oscillator to trade in the overbought zone (currently at 90), indicating that the possibility of a breather at higher levels cannot be ruled out.Thus, a close below Wednesday’s low of 10,355 would lead to pause in an ongoing uptrend. This may lead the index to enter a consolidation phase to cool off overbought conditions.

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