Tech View: Nifty forms Hammer candle, needs follow-up buying

NEW DELHI: Nifty50 reclaimed the 11,000 mark on Friday after testing a sub-10,900 level in intraday trade. The index formed a Hammer candle on the daily chart and an indecisive candle Spinning Top on the weekly scale. Follow-up buying is necessary for the index to break above the ongoing consolidation phase, said analysts.

The index formed ‘Hammer’ after retracing 50 per cent of its last leg of rally from the low of 10,637 to 11,141.

“While the index formed a Spinning Top on the weekly scale, the price action of last four weeks appears to be a phase of consolidation inside the larger range between 11,180 and 10,650 levels. Hence, if Nifty attracts a follow-up buying in next session, it should eventually pave the way for a bullish reversal pattern breakout above 11,141,” said Mazhar Mohammad of Chartviewindia.in.


Nifty needs to hold above 11,000 to witness a bounce towards 11,111 and then 11,141 levels, said Chandan Taparia of Motilal Oswal Services, who sees downside supports at 10,950 and 10,880 levels.

For the day, the index rose 74.95 points, or 0.68 per cent, to 11,023.

For the time being, positional traders are advised to go long on the index with a stop loss below 10,870 level on a closing basis and for an initial target of 11,250, Mohammad said.