Tech View: Nifty forms bullish reversal pattern. What traders should do next week

Nifty on Friday ended 151 points higher after four successive days of decline and formed a bullish reversal pattern on the daily chart.

The psychological mark of 22,000 holds intermediate support, followed by strong support of the 21,800-21,700 subzone. On the higher end, the 20-DEMA placed at 22,300, followed by a bearish gap of 22,430-22,500, is likely to act as a daunting task in the near period and an authoritative breakthrough could only re-strengthen the lost momentum to the bulls of D-Street, said Osho Krishan of Angel One.

What should traders do? Here’s what analysts said:

Tejas Shah, JM Financial & BlinkX
Technically, the set-up is mildly negative at this point with Nifty below the crucial resistance zone of 22,300-350. A crossover beyond this area is required for the bulls to be back in the game. Any immediate closing above 22,300-350 levels should bring back fresh buying momentum. Support for Nifty is now seen at 22,000 and 21,700-800.

On the higher side, the immediate resistance zone for Nifty is at 22,150-175 levels and the next crucial resistance zone is at 22,300-350 levels. Overall, the coming week should set up the market for a large trending move.

Rupak De, LKP Securities
Looking ahead, bulls may drive Nifty’s recovery towards 22,300. Furthermore, a decisive breakthrough above 22,300 could trigger a sustained rally towards 22,600. On the downside, support on a closing basis is situated at 22,000.(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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