Aditya Agarwala, Senior Technical Analyst at YES Securities said the higher lows that the index made in last three sessions is a positive sign for the bulls.
NEW DELHI: Nifty50 held on to the 11,500 level on Thursday, as consolidation continued in the index since Monday’s selloff.
After trading in a narrow range, the index eventually formed a Small Bearish Candle on the daily chart. Thursday’s was the third session when the index formed a higher low, which suggested that support for the index has shifted higher. Analysts said the consolidation phase may continue and the index will broadly trade in the 11,400-11,580 range in the coming days. “A breach of either level could send directional cues,” they said.
For the day, Nifty closed at 11,527, down 7.55 points. It hit a high of 11,584 and low of 11,507 during the session.
“Nifty is facing hurdles at higher levels, but every decline is getting bought into at the same time. It is forming a symmetrical triangle pattern on the lower time frame charts, as supports and resistances are coming closer to give a decisive price breakout. Now, the index has established an immediate support near 11,400 and 11,333 levels. A hold above 11,550 level can give an upper hand to the bulls,” said Chandan Taparia of Motilal Oswal Securities.
Aditya Agarwala, Senior Technical Analyst at YES Securities said the higher lows that the index made in last three sessions is a positive sign for the bulls.
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“A sustained trade beyond 11,580 level in the coming session could trigger more short-covering rallies and take the index to the 11,640-11,750 zone. On the flip side, a trade below 11,500 level could trigger fresh selling, dragging Nifty lower to 11,400 level. The RSI on a shorter time frame chart has failed to move above the 60 level, while a move beyond 60 would generate a range shift in favour of the bulls,” he said.
Check out the candlestick formations in the latest trading sessions Mazhar Mohammad of Chartviewindia.in said strength will be visible in the index if it remains above 11,585 level for at least 30 minutes in Friday's trade. “In that scenario, the chances of an intraday rally getting extended towards 11,700 level can’t be ruled out,” he said.
For Rajesh Palviya of Axis Securities, the 11,580 and 11,500 levels are crucial for the index, as he believes violation of the range on either side will give the market a clear direction.
