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Daily Technical View on Nifty

Observation: After showing an attempt of minor upside recovery on Tuesday, Nifty tanked on Thursday and closed the day with heavy loss of 546 points. Nifty opened on a downside gap of 344 points, made an attempt to show upside recovery in the early part of the session. A decisive intraday weakness has triggered 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 with long upper shadow. Technically, this pattern is indicating a selling momentum on the downside and also a sell-on-rise in the market. The unfilled opening downside gap of Thursday suggests more weakness ahead.

The immediate supports of daily 10 & 20 period moving average has been broken on the downside and another crucial support of ascending trend line has also been taken on the downside around 25400 on Thursday.

The positive chart pattern like higher tops and bottoms is still intact as per daily chart and the current chart pattern is indicating higher chance of negation of this bullish setup.

Conclusion: The sharp weakness of Thursday has changed the short-term sentiments of the market to downside. There is a possibility of Nifty sliding down to the cluster supports of around 25100-25050 (weekly 10 period EMA and 23.6% Fibonacci retracement) in the coming sessions, before showing any reasonable upside bounces. Immediate resistance is at 25400 levels.

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