Tech View: Nifty50 forms bullish candle, sends positive signals

Technically, it indicates a negation of bearish formation and signals positive bias for the market ahead, according to Nagaraj Shetti at HDFC Securities.

“The short-term trend of Nifty50 has turned positive and the overall chart pattern hints at a possibility of a sharp upside breakout of the hurdle. The next upside levels to be watched are around 16,200-16,300 in the short term. Immediate support is placed at 15,900 levels,” he said.

For the day, the index closed at 15,989.80, up 178.95 points or 1.13 per cent

As long as the index sustains above 15,800, it can be in a bright spot to bridge a bearish gap with a close above 16,172 level, said Mazhar Mohammed of Chartviewindia.

“In such a scenario, the rally may eventually expand towards its 200-day EMA, whose value is placed at the 16,550 level. However, in between, resistance from the downsloping trendline can not be ruled out around 16,100 level and a close above that shall further bolster the confidence levels of bulls. Meanwhile, on the downsides, 15,800 shall be considered as critical short-term support,” he said.

Milan Vaishnav, Founder & Technical Analyst, Gemstone Equity Research said that a large bullish candle reflected the directional consensus on the upside.

“As we step into the weekly options expiry day, the 16,000 level is likely to act as an inflection point. The 16,000-strike holds the highest call open interest. Any strong move above 16,000 will take the index higher towards the 50-DMA, which presently stands at 16,139. If the Nifty50 stays below 16,000, it may enter a consolidation zone,” Vaishnav said.

Nifty Bank

Independent Analyst Manish Shah said Bank Nifty saw a long bullish candle on the daily scale, with the index closing at the day’s high. The index is trading below its falling trendline and it needs to move above 34,480-35,000 for the rally to continue, Shah said.

“Nifty Bank is holding above its 20 days moving average and MACD is in a buy mode. A break above 34,480-35,000 will mean a rally to 36,100 odd levels, maybe before the end of July expiry. Support for the index is seen at 33,850,” Shah said.

(Disclaimer: Recommendations, suggestions, views, and opinions given by the experts are their own. These do not represent the views of Economic Times)