Tech View: Bearish candle on daily chart, Doji on weekly chart show Nifty indecisive
The index had been finding resistance in the 10,850-70 range, as it exhausted the recent upward move. But lower-level buying suggested that the fight between the bulls and the bears is even.
bearish candle on the daily chart and “Doji” candle on weekly chart indicated indecisiveness, as followup buying was missing on either side, said Chandan Taparia of Motilal Oswal Securities.
“The Nifty50 has been flirting with its 50-day EMA and continued its alternative positive and negative weekly closings for the ninth week. Now, it has to hold above the 10,750-10,777 zone to witness an upward move towards 10,880 and then the crucial hurdle in the 10,925-10,985 zone.
Friday was the second straight session when the index made a higher high and higher low formation. The symmetrical triangle pattern is still intact as Nifty closed near the lower end of a triangle at 10,750, said Nagaraj Shetti, Technical Research Analyst at HDFC Securities, who believes the weekly chart does not offer any predictive value.
The expert said Nifty’s underlying trend is rangebound with a weak bias.
Long lower shadows hold cues
“As long as the bulls defend the said level, the possibility of an upward breakout can’t be ruled out, though such a breakout will be confirmed only on a strong close above 10,870. For the time being, traders are advised to adopt a neutral stance on the index and focus on stock-specific opportunities in both directions,” he said.
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