NEW DELHI: Nifty50 reclaimed the 14,200 level in style on Monday, and formed a Long White candle on the daily chart to the surprise of many. The sharp gains made analysts believe that the NSE benchmark found a bottom at its recent low at 13,596 level. They said profit booking cannot be ruled out after Monday’s rise, but any fall could trigger buying.
“Technically, Nifty has created a strong bullish reversal pattern on the daily chart and is moving towards the 14,500 mark. Traders should consider reducing the weak positions on the resistance or around the cost price. The strategy should be to buy if Nifty corrects to 14,200 level. The index would move past the 15,300 level if it crosses the 14,800 mark,” said Shrikant Chouhan of Kotak Securities.
For the day, Nifty50 closed at 14,281, up 646.60 points or 4.74 per cent.
“After this bounce, the bulls can remain confident that a near-term bottom is in place at the recent low of 13,596, and hence, dips can be considered as an opportunity to create fresh long positions,” said Mazhar Mohammad of Chartviewindia.in.
He said the initial target for the ongoing leg of upswing can be the retest of the lifetime high of 14,753, but felt some profit booking cannot be ruled out on Tuesday.
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Chandan Taparia of Motilal Oswal Securities said the index has negated the formation of lower top and bottom. It took support near its 50-day EMA, he said and added that the index may see a fresh move towards 14,500 and 14,750 levels in the near future.
“On the downside, major supports exist at 14,000 and 13,800 levels,” he said.