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Daily Technical View on Nifty

Emergence of buying from the lows

Observation: After showing consolidation movement with weak bias on Wednesday, Nifty shifted into an intraday upside recovery after early part weakness on Thursday and closed the day with minor loss of 07 points. After opening with a downside gap of 183 points, the market started with firm upside recovery from near the opening lows. The intraday upside momentum with range bound action continued in the mid to later part of the session and finally Nifty closed near the day's high. The opening downside gap has been filled completely.

A long bull candle was formed at the lows on the daily chart on Thursday, which is indicating a possible comeback of bulls from the lower levels. Technically, this candle pattern signal a formation of bullish counterattack type pattern (not a classical one). The lack of selling pressure despite weak global market is signaling a chances of an upside bounce from here onwards.

The crucial 20 day EMA has been held after violating below it on Thursday. Nifty has been trading above this moving average since past 5-6 weeks. This is positive indication.

Conclusion: The short term trend of Nifty continues to be choppy. The lackluster movement with weak bias is expected to continue for the next 1-2 sessions, before witnessing a sharp upside bounce from the lows.

Important lower supports to be watched around 24100-24000 levels and this could be a buy on dips opportunity. Immediate resistance is placed at 24500 levels.

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