Tech View: Nifty50 forms a bearish candle, has support around 11,650

NEW DELHI: Nifty50 on Wednesday tanked 160 points ahead of the expiry of October series futures & options contracts. The index opened higher, but saw selling pressure above the 11,900 level.

It fell below its 20-day moving average and formed a bearish candle on the daily chart. Analysts said levels around the 11,650 mark may provide support to the index while any Nifty50 recovery beyond the 11,830 level may attract further support.

"During the session, the index fell towards the lower end of a Triangular Pattern. Going ahead, the 11,660-11,630 zone will be a key support to watch out for. The bulls are likely to get active near this zone, which can drive the index up again. On the higher side, the 11,800-11,830 zone will be the initial hurdle to keep tabs on," said Gaurav Ratnaparkhi, Senior Technical Analyst at Sharekhan.


For the day, Nifty fell 1.34 per cent to 11,729.

Independent analyst Manish Shah said the index needs to move above 11,800 level, if it were to move higher towards the 11,950-12,025 zone.

"With the October F&O series expiring tomorrow, we could see rangebound and volatile price action in the 11,630-11,800 range. We expect Nifty to remain in the 11,600-12,025 range for a prolonged period. Underlying price action is not overtly bearish, it is this sideways rangebound action which is creating uncertainties, capping both upside and downside," Shah said.

Aditya Agarwala, Senior Technical Analyst at YES Securities, said the index has closed below its crucial 20-day moving average placed at 11,775, confirming a temporary halt to the uptrend.

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"A sustained trade below 11,650 level will drag Nifty to 11,600 level. However, if the bulls manage to reclaim the 11,800 level, a short-covering rally may push the index further towards the 11,900-11,960 zone," he said.

"The 50-day SMA is placed at 11,540," said Shrikant Chouhan of Kotak Securities, who expects the 11,800-11,830 zone to act as a major hurdle for the market going ahead.