This pattern indicates a choppy movement in the market with weak bias. Nifty is currently showing signs of slowing down of downside momentum and is placed at the support of 10-day EMA around 19,650 levels, said Nagaraj Shetti of HDFC Securities.
The positive chart pattern like higher tops and bottoms is intact as per the daily timeframe chart and the market is currently in line with the new higher bottom formation, which needs to be confirmed, analysts said.
What should traders do? Here’s what analysts said:
Jatin Gedia – Technical Research Analyst at Sharekhan by BNP Paribas
Nifty took support at 50% Fibonacci retracement level (19650) of the rise from 19,300 – 19,992 and witnessed a bounce back which helped the index to close marginally in the green. The correction Nifty is undergoing is unlikely to result in a trend reversal and this intermediate pullback should be used as a buying opportunity. The primary trend is positive and hence we shall continue to maintain a bullish short-term outlook. In terms of levels, 19,615 – 19,560 shall act as a crucial support zone, and on the upside 19,830 – 19,850 shall act as an immediate hurdle zone.
Rupak De, LKP Securities
The daily chart indicates a downward consolidation with the price falling below the rising trendline. The RSI shows a bearish crossover. Notably, the support level at 19,550 is crucial, and if breached, the index could further decline towards 19,300. Conversely, resistance is positioned at 19,800 on the higher side.
Nagaraj Shetti, Technical Research Analyst, HDFC Securities
The short-term movement of Nifty is choppy. Having placed the support, there is a possibility of an upside bounce in the short term towards the immediate resistance of 19,800-19,850 levels in the coming sessions. The next support is placed at 19,600 levels.
Shrikant Chouhan, Head of Research (Retail), Kotak Securities
On daily charts, the index formed a small bearish candle and on intraday charts it is witnessing selling pressure at higher levels. For day traders, 19620 would be the key support level, and if the index trades above the same, we could expect a quick pullback rally till 19720-19750. On the flip side, dismissal of 19620 could accelerate selling pressure and below the same, the index could slip till 19570-19550.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)