Tech View: Nifty50 forms bullish candle on weekly chart; bias remains positive

NEW DELHI: Nifty50 made a good recovery from low on Friday and erased almost all gains, as it ended up forming a bullish candle on the daily chart. With that, the index also ended up with a decent bullish candle on the weekly chart, suggesting the bulls are in no mood to give up.

Nifty50 witnessed a buying interest at low as it entered into the bullish gap zone of 18,128-18081 level, giving legitimacy to the zone as critical short-term support, said Mazhar Mohammad at Chartviewindia.in.

"Sustaining above 18,081 level, thus, may help Nifty50 test lifetime highs of 18,600 levels. Contrary to this, a breach of 18,080 level on a closing basis can usher in a short-term downtrend," he said.

One should continue to trade with a positive bias and opt for a buy-on-dip approach in the coming week, said Ruchit Jain of 5paisa.com.

After hitting an intraday low of 18,119.65, Nifty50 eventually ended up at 18,255.75, down 2.05 points or 0.01 per cent.

"While the resistance of 17,950 has been decisively broken, the benchmark index now seems to be targeting its previous all-time high. We suggest traders maintain a bullish bias on the market. Having said that, minor dips cannot be ruled out going ahead and dips around immediate support levels can be used as buying opportunities," said Yesha Shah of Samco Securities.

Amol Athawale of Kotak Securities said that the texture of the market is bullish but due to an overstretched rally the market could consolidate in 18,050-18,375. For the bulls, 18375-18400 would be the immediate hurdle and above the same, the same breakout formation will continue up to 18,500, Athawale said.

"On the flip side, 18,150 would be the sacrosanct support level to watch out for. If the index succeeds to close below the same, the Nifty50 could retest 18,050-18,000 levels," he said.