Mazhar Mohammad said the index shall resume its downswing sooner than later unless it closes above 12,000 levels.
The Nifty50 closed rangebound session with marginal gains on June 7, showing a rebound after steep correction seen in the previous session. Banks and IT stocks led the market higher, but auto, FMCG and metals limited upside.
The index closed above 11,850 and formed 'Doji Cross' kind of pattern on the daily scale, while for the week, it was down 0.44 percent and formed 'Spinning Top' pattern on the weekly charts.
Spinning Top is often regarded as a neutral pattern which suggests indecisiveness on the part of both bulls and bears. It can be formed in an uptrend as well as in a downtrend.
Doji also indicates indecisiveness which means the market needs a trigger to move on either side, experts said, adding the index has to strongly surpass 12,000 to move above earlier record high levels.
The Nifty50 after opening higher at 11,865.20 remained rangebound throughout the session. It touched an intraday low of 11,769.50 in the morning and high of 11,897.50 in late trade, before closing 26.90 points higher at 11,870.70.
"Nifty50 registered a 'Doji Cross' kind of indecisive formation but with a long lower shadow as it staged a smart recovery from intraday lows of 11,769 levels whereas a 'Spinning Top' kind of indecisive formation is witnessed on weekly charts," Mazhar Mohammad, Chief Strategist, Technical Research and Trading Advisory at Chartviewindia.in told Moneycontrol.
He said considering the sharp fall of last 3 sessions from the highs of 12,103 levels, this kind of minor bounce is quite normal and the index shall resume its downswing sooner rather than later unless it closes above 12,000 levels.
On the downsides, breach of 11,769 shall once again make the bulls vulnerable with a downside target of 11,600 whereas any recovery attempt shall perish in the zone of 11,930-11,970 levels where fresh shorts can be considered with a stop above 12,000 levels on a closing basis, he added.
India VIX fell by 4.86 percent to 14.77 levels.
On the option front, Maximum Put open interest (OI) is at 11,500 followed by 11,000 strike while maximum Call OI is at 12,500 followed by 12,000 strike.
Minor Call writing is at 12,500 followed by 12,100 strike while Put unwinding is at all immediate strike price.
Option data suggests a wider trading range in between 11,750 to 12,250 zones, experts said.
"Now it has to hold above 11,888 zones to get some stability and move towards 12,000-12,041 zones while on the downside supports are seen at 11,761 then 11,660 zones," Chandan Taparia, Associate Vice President and Analyst-Derivatives at Motilal Oswal Financial Services said.
Bank Nifty opened positive and moved in a wider trading band of 500 points for the entire trading session. The index closed at 31,066.55, up 209.15 points.
It formed a Hammer Candle on the daily scale and an Inside Bar on the weekly scale, which implies that bulls are not loosening their grip at lower levels but at the same time bears are putting pressure at higher levels, experts said.
"Bank Nifty has to surpass and hold above 31,150 zones to witness an upmove towards 31,500 then 31,750 zones while on the downside supports are seen at 30,500 then 30,250 levels," Chandan Taparia said.
