Tech View: Nifty forms long bull candle. What should traders do on Wednesday
ETMarkets.com
Synopsis
Nifty is now at the hurdle of ascending the trend line around 17950-18000 levels. Hence, a decisive upside above 18K is likely to open a quick follow-through upside towards 18250 levels in the near term, chart readers said
Nifty on Tuesday formed a long bull candle on the daily charts as it surpassed its falling supply trend line by connecting all the swing highs of 18887, 18696, and 18201.
Nifty is now at the hurdle of ascending the trend line around 17950-18000 levels. Hence, a decisive upside above 18K is likely to open a quick follow-through upside towards 18250 levels in the near term, chart readers said.
Fear gauge index India VIX moved down by 1.66% from 13.68 to 13.45 levels. Volatility cooled off from its highs but now needs further drip down for market stability to resume.
Options data suggests a broader trading range between 17500 to 18200 zones while a shift in the immediate trading range between 17750 to 18100 zones.
What should traders do? Here’s what analysts said:
The short-term trend of Nifty seems to have turned up. Having placed at the important downtrend line resistance around the 18K mark, there is a possibility of minor consolidation in the coming sessions before showing any decisive upside breakout. Immediate support is placed at 17,750 levels.
Shrikant Chouhan, Head of Equity Research (Retail), Kotak Securities
After a gap-up opening, the market held positive momentum and also cleared the hort-term resistance of 17,900, which is broadly positive. We are of the view that as long as the index is trading above 17800, the reversal formation is likely to continue above the same, the index could move up to 18050-18100. On the flip side, the uptrend would be vulnerable below 17,800.
On the daily charts, we can observe that Nifty managed to close above the immediate hurdle zone of 17850 – 17900, which puts the bulls in a position of advantage. The hourly Bollinger bands have begun to expand, indicating expansion in volatility and prices trading along the upper band, suggesting that the positive momentum is likely to continue. The daily momentum indicator has a positive crossover which is a buy signal. Thus both price and momentum indicators are suggesting further upside in the index. On the upside, we expect the Nifty to test the upper end (18100) of the downward-sloping channel from a short-term perspective.
Rupak De, Senior Technical Analyst at LKP Securities
Nifty witnessed strong buying momentum from the lower level and surpassed the hurdle of 17900 on a closing basis. The index remains in buy mode as long as it holds the support of 17700 on the downside. The momentum oscillators are in a strong buying zone, confirming the strength.
Nifty continues to be in a sideways range, with theupper endd of the range being at 18,260, which is the end of the congestion zone as well. A bullish closing above this can ensure the resuming of the uptrend for this index.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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Now, it needs to hold above 17888 zones for an up move towards 18018, then 18081 zones, whereas supports are placed at 17850 and 17777 zones, said Chandan Taparia of Motilal Oswal.Nifty is now at the hurdle of ascending the trend line around 17950-18000 levels. Hence, a decisive upside above 18K is likely to open a quick follow-through upside towards 18250 levels in the near term, chart readers said.
Fear gauge index India VIX moved down by 1.66% from 13.68 to 13.45 levels. Volatility cooled off from its highs but now needs further drip down for market stability to resume.
Options data suggests a broader trading range between 17500 to 18200 zones while a shift in the immediate trading range between 17750 to 18100 zones.
What should traders do? Here’s what analysts said:
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Nagaraj Shetti, Technical Research Analyst, HDFC SecuritiesThe short-term trend of Nifty seems to have turned up. Having placed at the important downtrend line resistance around the 18K mark, there is a possibility of minor consolidation in the coming sessions before showing any decisive upside breakout. Immediate support is placed at 17,750 levels.
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After a gap-up opening, the market held positive momentum and also cleared the hort-term resistance of 17,900, which is broadly positive. We are of the view that as long as the index is trading above 17800, the reversal formation is likely to continue above the same, the index could move up to 18050-18100. On the flip side, the uptrend would be vulnerable below 17,800.
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Jatin Gedia, Technical Research Analyst, Sharekhan by BNP ParibasOn the daily charts, we can observe that Nifty managed to close above the immediate hurdle zone of 17850 – 17900, which puts the bulls in a position of advantage. The hourly Bollinger bands have begun to expand, indicating expansion in volatility and prices trading along the upper band, suggesting that the positive momentum is likely to continue. The daily momentum indicator has a positive crossover which is a buy signal. Thus both price and momentum indicators are suggesting further upside in the index. On the upside, we expect the Nifty to test the upper end (18100) of the downward-sloping channel from a short-term perspective.
Rupak De, Senior Technical Analyst at LKP Securities
Nifty witnessed strong buying momentum from the lower level and surpassed the hurdle of 17900 on a closing basis. The index remains in buy mode as long as it holds the support of 17700 on the downside. The momentum oscillators are in a strong buying zone, confirming the strength.
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Rahul Ghose, Founder & CEO, HedgedNifty continues to be in a sideways range, with theupper endd of the range being at 18,260, which is the end of the congestion zone as well. A bullish closing above this can ensure the resuming of the uptrend for this index.
(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of The Economic Times)
