On daily charts, we can observe that Nifty has been consolidating after a sharp rally of about 350 points in the previous couple of trading sessions. This consolidation is a healthy sign and shall set the floor for the next leg of an upmove. On the downside, the gap area formed in the range 19718 – 19757 is likely to act as a short-term support, and on the upside, the rally has the potential to extend to 19,884 – 20,030.
The short-term trend of Nifty continues to be positive. A decisive move above 19,800 levels is likely to pull Nifty towards the next upside levels of 20,000-20,200 in the near term
Nifty started to form a higher bottom and also breached the previous swing high confirming the reversal. The momentum indicator still has a negative crossover however it is likely to align with the price action soon, chart readers said.
The formation of a bullish hammer candle pattern of last week as per the weekly timeframe chart is still intact. The index is expected to slide near the low of the said hammer pattern around 19,350-19,450 levels in the short term before showing another round of upside bounce from the lows. Immediate resistance is placed at 19,620 levels, said Nagaraj Shetti of HDFC Securities.
The short-term trend of Nifty has turned positive. The overall positive chart pattern indicates next overhead resistance for the Nifty around 19,800 levels for the coming week. Any dip down to 19,550-19,500 levels could be a buying opportunity, said Nagaraj Shetti of HDFC Securities