Tech View: Nifty bulls defending support, but upside looks limited
The hourly momentum indicator has completed its correction cycle and is set for a new cycle on the upside from the equilibrium line, said Gaurav Ratnaparkhi, Senior Technical Analyst at Sharekhan.
A trade below 13,400 level may trigger sharp corrections in Nifty to 13,200-13,100 levels. The RSI is also suggesting lack of momentum on the upside.
NEW DELHI: Nifty50 on Tuesday tested its immediate support range at 13,450-470, before recovering and closing in the black. With this, the index formed an indecisive Doji candle on the daily chart for the fourth consecutive day. The bulls seem to be defending the support levels rigorously, but the upside seems limited, analysts said.
“The bulls are constantly protecting the 13,400-13,450 zone in intraday declines. On the upside, the bears are protecting the 13,550-13,600 zone. Moreover, multiple Doji and Hanging Man candlestick patterns on the daily chart suggest lack of momentum in the uptrend. A trade below 13,400 level may trigger sharp corrections in Nifty to 13,200-13,100 levels. The RSI is also suggesting lack of momentum on the upside," said Aditya Agarwala, Senior Technical Analyst at YES Securities.
For the day, Nifty closed at 13,567, up 9.70 points or 0.07 per cent.
“For the fourth straight session, we have witnessed such a move where the market has recovered from the lows and ended with the formation of a Doji candle. Although this does not reflect any trend reversal, the 13,400-13,600 zone now becomes a crucial range and a breakout of the same would lead to the next leg of directional move. A move above the 13,600 level may lead to an extension of this trend towards 13,750 level, which is the 127 per cent retracement level of the previous correction on the weekly charts,” said Ruchit Jain of Angel Broking.
The hourly momentum indicator has completed its correction cycle and is set for a new cycle on the upside from the equilibrium line, said Gaurav Ratnaparkhi, Senior Technical Analyst at Sharekhan.
“The junction of 40-hour exponential moving average and the hourly lower Bollinger Band is attracting fresh buying interest. These observations suggest Nifty maintains its upward trajectory with a short-term target at 13,700,” he said.
