INSUBCONTINENT EXCLUSIVE:
The NSE benchmark Nifty on Thursday oscillated in a capped range and managed to hold on to its important support levels
It was in the last hour of the trade when the market saw some sharp recovery, as Nifty ended with a gain of 18.30 points or 0.17 per
cent.
The session remained technically important, as the index kept its head above key support levels of 200 DMA and 100 DMA, which remain
in the close vicinity of each other.
With the market holding on to these supports, it has prevented any major weakness to creep in
However, in any case, the zone of 10,900-10,950 has now become a major hurdle for the market
Sooner the Nifty moves past this zone, better it will be in the immediate short term.
As we approach Friday’s trade, we expect a stable
The range from 10,900 to 10,945 levels will act as immediate resistance area
Supports may come in at 10,800 and 10,770.
The Relative Strength Index (RSI) on the daily chart stood at 51.66, and it remained neutral not
showing any divergence against the price
The daily MACD has shown a negative crossover and it traded below its signal line.
As per pattern analysis, it is observed that Nifty has
failed to give any sustainable breakout despite moving well into the apex of the ascending triangle formation
This has made the breakout little difficult, and the zone of 10,900-10,950 has reestablished itself as a important resistance area.
Overall,
there is no structural damage to the charts as the index remained above all of its key moving averages
At the same time, the zone of 10,775-10,835 is a very important support area for Nifty, as all of its key moving averages fall in this
area.
In the present context, we expect the market to consolidate for some more time
Given the fact that Nifty remained above its key support levels, the market may now must be approached with cautious optimism, while keeping
overall exposures at modest levels.
(Milan Vaishnav, CMT, MSTA is Consultant Technical Analyst at Gemstone Equity Research Advisory
He can be reached at milan.vaishnav@equityresearch.asia)
