Nifty: Tech View: Nifty forms bullish candles; Enjoy the assembly until it lasts, say

NEW DELHI: The Nifty 50 on Friday capitalized on a strong gap-up start as the index almost ended the day high. In the process, it violates the instantaneous resistance level of 16,150 and creates a bullish candle on both daily and weekly scales. Analysts said further uptrend has stopped and advised traders to be cautiously bullish for the coming week.

Gaurab Ratnaparkhi of Sharekhan said the May 19 sharp fall was caught near the swing low of 15,735, adding that the March low of 15,671 provided additional support to the downtrend.

“With this, it has filled the recently created void in the daily chart. Going forward, the indicator is set to test the upper edge of a reverse falling channel and the swing high of 16,400, which is a key obstacle to notice. On the contrary, 16,100- 16,000 will serve as a near-term support zone, “said Ratnaparkhi



For the day, the index rose 456.75 points (2.89%) to close at 16,266.15.

Subash Gangadharan, senior technical and derivatives analyst at HDFC Securities, said the daily Nifty50 deadline indicates that the index has reached a double bottom near the 15,735 level.

“While we will be open to more pullback rallies in the near future, we must keep in mind that the intermediate trend remains. The bears will gain more control if the recent intermediate low of 15,735 is broken. Until then, enjoy the rally until it lasts.” Said.

Despite the rebound, we think the market has not reached its bottom, as price patterns on the Nifty50 show that the uptrend has been significantly hurt, said Yesha Shah, head of equity research at Samco Securities.

“Similarly, the weekly chart of the S&P 500 index shows a head and shoulder breakdown. Having said that, a short-term rebound cannot be blown away and it is not clear at this point whether the bounce will be a relief rally or the start of a new bullish rise.” We recommend that traders remain cautiously bullish for next week until the Nifty breaks below the 15,700 level, “said Yesha.

Nifty Bank
Bank Nifty has created a bullish candle on daily and weekly scales and a small follow-up could trigger some more bounces in higher areas, Chandan said.

Securities.

“The move would have to hold it above 34,000 to extend it to 34,500 and 34,750 while negative support exists in the 33,666 and 33,500 zones,” Taparia said.


(Disclaimer: The recommendations, suggestions, opinions and opinions offered by the experts are their own. These do not represent the views of the Economic Times)

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