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Daily Technical View on Nifty

Market: Observation

* Markets corrected sharply on Thursday after a positive opening. The Nifty finally lost 164.8 points or 0.93% to close at 17,589.6. Broad market indices like the BSE Mid Cap and Small Cap indices lost less, thereby out performing the Sensex/Nifty. Market breadth was negative on the BSE/NSE.

Nifty: Short term uptrend has reversed ????

* Zooming into 15 min chart, we can observe that Nifty witnessed selling pressure from highs of the day and gradually came down to close near the lows of the day. In the process, Nifty has closed below Wednesday’s low and the pattern of higher tops and higher bottoms seen over last few sessions has reversed, thereby indicating a reversal of recent short term uptrend.

* There has also been a negative MA crossover as the 20 period MA has moved below the 50 period MA on the 15 min chart. Nifty could move lower towards the next support of 17536 in the very near term.

Nifty: Intermediate trend remains down

* On Daily chart, we observe that while the Nifty has been rallying over the last few sessions, Thursday’s sell off indicates that Nifty is finding resistance near the downward sloping trend line that has held down the highs of December 2022 and January 2023 and also the 50 day SMA.

* So unless Nifty can convincingly cross these resistances, there are good chances of the intermediate downtrend continuing.

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