5
NEW DELHI: The NSE Nifty on Friday snapped a four-session winning streak, but held on to its support zone of 11,1540-11,550 on a closing basis, as buying momentum emerged at lower levels.
The index made an indecisive Doji on the daily chart, even as the weekly formation suggested the positive bias was intact.
On Friday, Nifty negated its formation of higher highs-higher lows of last four sessions, and formed a small bodied indecisive candle on daily scale, said Chandan Taparia of Motilal Oswal Securities, noting that the index still maintains its overall bullish setup on the weekly scale.
At close on Friday, the index was down 25.65 points, or 0.22 per cent, at 11,557.10.
During the session, the index briefly touched 10,600, only to retreat later, suggesting caution among traders at higher levels.
"The index has been trading in a rising channel with the support of rising trend line.
It has to continue to hold above 11,550 to witness an upmove towards 11,635 level.
On the downside, the immediate major support is seen in 11,500-11,450 range," Taparia said.
Nagaraj Shetti of HDFC Securities said the small positive candle on the weekly time frame had upper shadow, which signalled a choppy trend.
“The short-term trend remains choppy, minor downward correction is likely for next week," he added.
Enough sell signals emerged on lower time frame charts, post Friday’s price action, suggesting that the said index may be on the verge of a short-term trend reversal, said Mazhar Mohammad of Chartviewindia.in.
“Selling shall get accelerated if it breaches the 39-day old ascending channel, whose support is placed around 11,532, which is in progress from the lows of 10,550 level.
In next trading session, a close below below 11,498 levels shall confirm the short term downtrend.
It looks prudent on the part of traders to book profits and remain on sidelines till further signs of strength are seen in the markets," Mohammad said.
