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Nifty

On the daily scale the smart recovery from the expected support zone of 17450 ensured that the ongoing 17540 closing-basedsupportzone remained valid. The recovery from the early morning losses eventually resulted into a dual combination of candlestickreversal formations viz. the ‘Bullish Hammer’ & also a prominent ‘Bullish Harami’. Occurrence of these patterns is a strong sign of afollowthrough move in a day or so which would help the index to surface back above its 5 & 20 DEMA zone resistance levels. Thepriorwavesintensity of the decline remains critical as index breached & engulfed its 6 days price action within 1.5 days itself sending jittersinthemind of investors & traders. Hence the recovery also should be significant in case the index needs to re-counter the movetowards18100. On the oscillator front both its trend strength indicators are placed around their respective make or break zones withRSI hovering at 50 & ADX at 25 which still support the ongoing price action trend to remain firm on the bullish side. As per theweeklydataset it looks like a ranged price action within 17800-17400 zone traders should refrain from building aggressive positions oneitherduringthe week & wait for more clarity to emerge post this weekly close. An early close above 17800 could evoke the upside movetowards18210 only while a sustained closing below 17300 could push the index towards 17000.

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