He said Nifty needs to break above the 11,550 level to be able to move towards the 11,695-11,800 zone.
NEW DELHI: Nifty50 rose for the second straight session on Wednesday and formed a small bullish candle on the daily chart. This formation, following Tuesday's indecisive long-legged Doji candle, suggests the index has entered a consolidation phase after Monday's selloff.
"In the last two sessions, Nifty has ignored the large red candle that was formed on Monday. This means the bears have failed to push the market further lower despite a spate of bad news," said independent analyst Manish Shah.
He said Nifty needs to break above the 11,550 level to be able to move towards the 11,695-11,800 zone.
On Wednesday, the index hit an intraday high of 11,554 before closing at 11,535, up 64.75 points or 0.56 per cent.
Nagaraj Shetti of HDFC Securities said Nifty has been sustaining above the uptrend line support -- connecting the recent higher lows and the 20-day EMA in the 11,340-11,380 range.
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"The minor positive sequence of higher highs and lows is intact, and if we consider the recent swing low of 11,326 as a new higher low of the sequence, Nifty50 should conquer the new swing high above 11,796 level in the near term. This seems like a difficult task as of now. Hence, one needs to be cautious about long positions above the 11,600 level," he said.
Mazhar Mohammad of Chartviewindia.in said Nifty has support at the 20-day exponential moving average (EMA) and 36-day ascending channel. "As long as Nifty50 sustains above 11,325 level, a rangebound move in the 11,387–11,700 range on a closing basis is on the cards," he said.
Aditya Agarwala of YES Securities said moving past the resistance zone at 11,560 can trigger a short-covering rally on Nifty50 to the 11,615-11,750 zone. A failure to break out of the resistance may trigger profit booking, dragging the index lower to 11,425 level, he said.
