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Daily Technical View on Nifty

Closed above the hurdle of 200day EMA..

Observation: After showing narrow range movement on Wednesday, Nifty shifted into a decent upmove on Thursday and closed the day higher by 84 points. After opening on a weak note, the market has started to show upmove from the lows since opening. The upmove continued for better part of the session and intraday dips in between have been bought into. Nifty closed the day nearhighs.

A reasonable positive candle was formed on the daily chart, that has engulfed the small negative candle of previous session on the upper side. Minor negativity created after a range movement at the hurdle on Wednesday was negated and the Nifty closed the day above 16600 levels.

Nifty managed to sustain above the crucial hurdle of 200 day EMA around 16520 levels on Thursday. The opening upside gap of 20th July around 16360-16490 levels is intact after 2 days of its formation. As per gap theory, if the said gap remains unfilled in the next couple of sessions, then that gap could be considered as a bullish runaway gap and that could possibly suggestmarketisinmidway oftrend.

Conclusion: The short term trend of Nifty remains up. The intact of recent opening upside gap and a negation of small negative candle of Wednesday signal a possibility of further upside in the short term. The next upside resistance to be watched around 16800 levels. Immediatesupportis placed at 16480 levels.

Nifty – Daily Timeframe chart

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