Home Market Tech view: Nifty forms bearish candle, has key support at 10,550

Tech view: Nifty forms bearish candle, has key support at 10,550

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NEW DELHI: The Nifty50 tumbled for the second straight session on Thursday and ended up forming a bearish candle on the daily chart. Technical indicators turned weak, but a small pullback cannot be ruled out.

“In the near term, the 10,550 level will provide crucial support. The index is likely to drift towards 10,417 and subsequently towards 10,325, which is the 61.8 per cent retracement level of its previous rise once the 50-pack breaks below 10,550,” said Gaurav Ratnaparkhi of Sharekhan.

“On its way up, the 10,632-10,674 range will be key resistance in the near term. A rise towards the resistance zone shall be considered a selling opportunity,” the expert said.

For the day, the Nifty50 fell 82.30 points, or 0.77 per cent, to end at 10,589. It struggled to enter the positive terrain throughout the session.

Nagaraj Shetti of HDFC Securities said levels around the 10,550 mark may offer a minor base for the market in the coming sessions.

Nifty recorded a days low of 10,557, which was around its earlier support zone between 10,550 and 10,530 levels. The support zone also coincides with the 100-day SMA of 10,529 and, hence, a pullback from the support zone cant be ruled out, said Rajesh Palviya of Axis Securities.

Mazhar Mohammad of Chartviewindia.in advised traders to avoid bottom fishing for the time being till some signs of strength and stability get visible. The bulls will get strength if they manage to claw back above the 50-day EMA at 10,666.

Chandan Taparia said the indexs fall has coincided with the formation of higher high and lower lows for last three sessions. As long as it sustains below 10,660, Nifty could weaken towards 10550, he said.

Mustafa Nadeem, CEO at Epic Research, is a bit bearish on the market. He expects Nifty to weaken further and test lower levels in the 10,510-10,520 range.

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