NEW DELHI: Nifty50 could barely hold the 11,600 level on Monday, as the index formed a Bearish Engulfing pattern on the daily chart. Analysts said that Tuesday’s trading could be crucial, as it may set the tone of market in the coming sessions.

A Bearish Engulfing suggests the bears are gaining momentum.

“A move below 11,550 will trigger more corrections, dragging the index towards 11,465-11,420 levels. But a trade above 11,650 may trigger short covering rally towards 11,700-11,760. For resumption of the bull trend, a close beyond 11,760 is required; otherwise bears may take control of the market and push Nifty down gradually,” said Aditya Agarwala of YES Securities.

Arun Kumar of Reliance Securities said the near-term oscillators have triggered ‘sell’ call.

“The evolving price pattern indicates corrective action. The index may attempt to find support around 11,460 - 11,500 levels,” he said.

For the day, Nifty fell 61.45 points, or 0.53 per cent, to 11,604.50. The The index found some support around key technical moving averages on the hourly chart.

“The subsequent session would be quite crucial, or we can say, may turn out to be a trend decider for the next few days. As of now, we still do not see any major reason to worry and construe this as a part of a profit booking phase. For the coming session, 11,549 would now be seen as a crucial support,” said Sameet Chavan of Angel Broking.

This expert warned traders of taking aggressive positions.

Nagaraj Shetti of HDFC Securities expects the ongoing decline may get restricted around 11,250-11,200 levels, but said the decline may unlikely damage the uptrend structure of the market.