Securities said the index formed a bearish candlestick with a long lower shadow, which indicates the formation of a ‘Hammer’, even if it is not classical.
“Such market action indicates a short-term bottom reversal pattern for the market. It could also indicate a short range false downside breakout at the 15,700 level. This is a positive sign, and there is no upside in the short term. can expect,” Shetty said.
This analyst believes that only a sustained swing above 15,900-15,950 can bring the bulls back into the market. He sees immediate support at 15,630.
Nifty 50 for the day ended 28.20 points or 0.18 per cent lower at 15,752.05. Mazhar Mohamed of chartviewindia.in said that the index recovered smartly from the intraday low of 15,511, who also felt that Friday’s formation was akin to a ‘hammer’.
“On the weekly chart, it is seen in a bearish divergence zone of 15,886 and 16,172 levels. Above 16,172 level, a permanent position will be formed till Nifty 50 absorbs the supply emanating from the said bearish zone. The increase will not be expected. Furthermore, for long trades from current levels, technically, the stop loss level remains below 15,511, which may not provide a favorable risk-reward ratio.”
Gaurav Ratnaparkhi of Sharekhan said that even though the index started the week on a strong note, it could not build on the gains.
“Consolidation was observed throughout the week. The near term support area was placed around 15,700-15,650, which the index breached on July 1. However, it found support near 15,500. The overall structure suggests that the index We are likely to see consolidation in the range of Rs.15,500-15,900 in the coming sessions,” Ratnaparkhi said.
Securities said Nifty Bank opened negative but showed a great recovery from the start of the day. The index took support at 33,100 and moved higher throughout the day to reach 33,666 as the index outperformed the broader market.
“It formed a bullish candle on the daily frame but a bearish candle on the weekly frame. Nifty bank negated its lower high of last three weeks. It needs to hold above 33,333 to move towards the 33,750 and 34,000 zones, While support has been placed in zones 33,000 and 32,750,” he said.
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