Nifty ended Friday’s session 429 points higher to form a long bull candle on the daily chart to signal a decisive upside reversal in the market post downward correction.
The immediate supports like 10/20-day EMAs have been regained after violating below it recently. These moving averages have been offering support for the index in the last 5-6 weeks. The positive chart pattern like higher tops and bottoms is intact on the daily chart and Nifty seems to have confirmed a new higher bottom formation recently, said Nagaraj Shetti of HDFC Securities.
The next upside levels to be watched are around 25,000-25,100 in the near term. Immediate support is placed at 24,650 levels, he said.
What should traders do? Here’s what analysts said:
Jatin Gedia, Sharekhan
This current up move can extend towards 25,350 – 25,530. Support base now stands at 24,400, which is the 20-day moving average. The daily momentum indicator still has a negative crossover. However, we shall assign more weightage to the price action and ride the up move.
Rajesh Bhosale, Angel One
During the week, 20-EMA provided support during several attempts, and now a higher bottom formation is visible around it on the daily chart. This swing low of 24,070 and the base formation around 24,200 are pivotal levels; as long as these levels hold, optimism is expected to continue, with markets targeting new milestones.
On the flip side, the index can first aim to test the psychological level of 25,000 and then the 161.8% retracement of this week’s swing at 25,340. Immediate support can be seen around 24,600. Momentum has definitely picked up for the bulls again, but one should avoid complacency as momentum indicators are still trading in overbought territory.
Rupak De, LKP Securities
Nifty has experienced a downward consolidation breakout on the daily chart, suggesting a rise in optimism. A sustained trade above the very short-term moving average, the 21 EMA, gave the index bulls the strength to take the Nifty to new highs amid global market weakness. A fairly large green candle after several insignificant candles clearly signals a bullish trend ahead. The trend might remain positive as long as it stays above 24,500. On the higher end, the index might move towards 25,250.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
