Tech view: Bulls made comeback bid, but got no followup support

NEW DELHI: The Nifty50 made a smart rebound on Monday, recovering some of the lost ground after hitting the sub-10,600 level in intraday trade. This suggests the bulls were trying hard to make a comeback.

But followup buying was missing, badly.

Shirkant Chauhan of Kotak Securities noted that the Nifty retracted almost 50 per cent from the high of 10,030 and 11,200 -- where the index spent 36 days. It retraced to the 10,600 level, which is the 50 per cent area of the entire rise, and which is now a key support area.


“A strong bout of selling on Friday was followed by a huge gap-down opening. However, the intraday activity was not as bad as one would have feared. During the day, Nifty respected the 10,600 level. Eventually, it managed to trim some of the early morning losses to end below the 10,700 mark,” said Sameet Chavan, Chief Analyst-Technical and Derivatives at Angel Broking.

Chauhan remained cautious on the market and expects the Nifty50 to slide towards 10,597 and 10,500 levels in the days to come. On the upside, the 10,750 and 10,840 levels would now be seen as strong hurdles, Chauhan said.

At close, the index was down 94.05 points, or 0.87 per cent, at 10,666. The index ended up forming a bullish candle, as the closing value was higher than the opening level of 10,604.

The huge gap-down opening was bought into by the market participants, said Mazhar Mohammad of Chartviewindia.in.