Nifty dropped 221 points after 5-6 sessions of narrow, weak movement - HDFC Securities Ltd
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Daily Technical View on Nifty
On the verge of downside breakout of the range..
Observation:
After showing a narrow range movement with weak bias in the last 5-6 sessions, Nifty slipped into sharp weakness on Thursday and closed the day lower by 221 points.
After opening with a positive note, the market started to show declines soon after the opening. The down trend continued amidst a range movement in the mid to later part of the session and Nifty finally closed at the lows.
A long bear candle was formed on the daily chart, which is indicating that market is on the verge of showing a sharp downside breakout of sideways range movement. This is negative indication.
After the series of positive chart pattern like higher highs and lows till last month on the daily chart, the recent minor upside bounce with range bound action could be considered as new lower top around 25200 levels.
Hence a decisive move below the support of 24700 is expected to form a new lower bottom in the near term.
Conclusion:
The short-term trend of Nifty remains weak. A slide below 24700 could open the next downside levels of 24500-24400 by next week. Immediate resistance to be watched at 24900.
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