By Nagaraj Shetti
Where are we: The
Nifty has been moving in a narrow range in the last 4-5 sessions. A small body negative candle has been formed on Friday with lower shadow. Technically, this pattern is indicating a sideways range movement in the market in the past few sessions. The recent rise from 10,000 mark has witnessed a formation of long range bull candles on the upside and smaller negative candles during declines. This pattern was absent during a downtrend of the past few months and this action is signalling that the market is unlikely to show any sharp weakness from near the hurdle of 10,600-650 levels, and eventually, this hurdle is going to be broken on the upside.
What is in store: The near-term trend of Nifty is range bound, some more lacklustre type movement could be expected for this week. A choppy trend or a minor weakness from here is going to be a
buy-on-dips opportunity in the Nifty.
Eventually, the hurdle of 10,600-650 levels is going to be broken on the upside, in the next couple of weeks. The immediate support is now placed at 10500-480 levels for the next week, where one may expect an emergence of buying interest from the lows. The key overhead resistance to be watched is at 10,600-650 levels.
What could investor do: One may continue with long trading positions in the Nifty/stocks and look to add more on any market dips from here. A sustainable move above 10,650 levels could lead the Nifty towards 10,850-900 in the near term.
(The author is Technical Research Analyst, HDFC Securities.)