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Tech View: Nifty forms indecisive Spinning Top, outlook cautious

NEW DELHI: Nifty50 on Friday rose past its 200-day EMA to close above the 11,300 mark and formed an indecisive Spinning Top on the daily chart. It also formed a bullish candle on the weekly chart.

Analysts were cautiously optimistic on the index prospects. “We advise traders to look for buying opportunities from a short-term perspective. The positive view will remain intact till the index trades above the swing low of 11,090,” said Ruchit Jain, Equity Technical Analyst, at Angel Broking.

“This level could be a stop loss for long positions. On the higher side, 11,400 is the immediate resistance, but we expect it to be taken out soon,” he said.

For the day, the index rose 66.70 points, or 0.59 per cent to close at 11,301. “It formed a bullish candle on the daily as well as weekly charts with long upper and lower shadows, which implied that dips are being bought into. That said, supply is intact at higher levels. The index needs to hold above 11,250 to witness a bounce towards 11,400. On the downside, major support is seen at 11,100,” said Chandan Taparia of Motilal Oswal Securities.

Critical support on the downside continues to be at 11,090, but for short-term traders, the 11,189 level shall remain important, said Mazhar Mohammad of Chartviewindia.in.

“On Monday, sustaining above the 11,189 level can lead Nifty to test 11,400 level, whereas a breach of the said level can increase selling pressure on an intraday basis,” he said.

Source: Economic Times