NEW DELHI: Nifty50 on Friday formed an indecisive Doji candle on the daily chart and an Inside Bar on the weekly chart, suggesting that the index may continue to consolidate within a range going forward.
The index has been consolidating in the past couple of weeks and is currently trading near the upper end of the range.
“Nifty50 crossed a swing high of 17,884 as well as a falling trendline from the previous swing high,” said Gaurav Ratnaparkhi of Sharekhan, who also noted that the bears didn’t allow the index to cross the recent high of 17,947 and also the daily upper Bollinger Band.
“The index is trading right into the hurdle zone of 17,900-17,950. The barrier is expected to keep the index in a consolidation phase. On the downside, immediate support is in the 17,840-17,800 zone, below which the bears can take charge,” he said.
Samco Securities said even though Nifty50 is still in the overbought zone, it has not seen any significant correction. The brokerage advised traders to maintain a bullish bias going ahead, but asked them to remain vigilant of any breach of the newly established support in the global indices. For Nify50, it sees support and resistance at 17,500 and 18,050 levels.
For the day, Nifty closed at 17,895.20, up 104.85 points or 0.59 per cent.
“The technical oscillators seem to be clueless, as Nifty50 continued its surge, even as they remained bearish with lower tops. Hence, if the bulls manage to defend the low of 17,840 level in the next trading session, then they will make an attempt to enter the uncharted territory by surpassing the 17,947 level with initial targets in the zone of 18,100-200 levels,” said Mazhar Mohammad of Chartviewindia.in.