The 50-pack index made a higher highs and lows, even though Thursday’s intraday high of 11,238 was just a fraction higher than Wednesday’s high of 11,238.
Shutterstock.comAnalysts said supports are moving higher gradually, but Nifty is facing hurdles at higher levels.
New Delhi: Nifty50 resumed its upward trend on Thursday, negating a ‘Hanging Man’ candle formed on the previous day, which required follow-through selling.
The 50-pack index made a higher highs and lows, even though Thursday’s intraday high of 11,238 was just a fraction higher than Wednesday’s high of 11,238. The consolidation range of 10,900-11,250 for the index has remained intact. Read: Nifty takes a breather, but no confirmation of trend reversal yet
Analysts said supports are moving higher gradually, but Nifty is facing hurdles at higher levels.
“Price action of last 21 sessions has chalked out an ascending channel, with multiple touch points. Nifty50 appears to be struggling at the upper boundary of that channel. Hence, a decisive breakout in the form of a strong close above the 11,238 level is required to instill confidence among the bulls. In that scenario targets can be in the 11,400 -500 zone,” said Mazhar Mohammad of Chartviewindia.in.
For the day, the index rose 82.85 points, or 0.74 per cent, to 11,215. On technical charts, Nifty formed a bullish candle on the daily chart. The 14-day relative strength indicator or RSI, which measures the stock’s internal strength, stood in the oversold territory at 72.91. An RSI value above 70 is considered as an ‘overbought zone’ and below 30 as ‘oversold zone'.
"There is no negative divergence in RSI yet. The index made higher high and low. This is a strongly trending market,” said independent technical analyst Manish Shah. He said Nifty still has room to move higher, before the resistance causes a pause in the rally.
"Supports for Nifty50 are shifting higher gradually. The index has been respecting its rising support trend line by connecting all the recent swing lows. It is holding above the 200-day EMA. As long as the index holds above 11,100 level, it could extend its momentum towards 11,333 and 11,500. Supports are now seen at 11,050 and 11,000 levels," said Chandan Taparia of Motilal Oswal Securities.
Rohit Singre, Senior Technical Analyst at LKP Securities, said support for the index has shifted to the 11,140-11,050 zone. “A hold above the said levels can see Nifty move swiftly towards the 11,300-11,350 zone, which is the immediate resistance on the higher side. One should stick to longs or buy on dips near the 11,100 level," he said.
Shutterstock.com
Get Unlimited Access to The Economic Times
