Tech View: Nifty forms Dark Cloud Cover; support seen at 14,500 level

Tech View: Nifty forms Dark Cloud Cover; support seen at 14,500 level

NEW DELHI: Nifty50 on Thursday erased intraday gains as it settled below the 14,600 mark, forming what looked like a Dark Cloud Cover candle on the daily chart. A Dark Cloud Cover is formed when the index opens higher, but closes below the midpoint of the previous session’s candle body.

A short-term reversal in the index can be confirmed if Nifty50 closes below the 14,500 level on Friday, said Mazhar Mohammad of

“Sensex scaling the milestone of 50,000 can be a huge psychological barrier, and that can prompt investors to book profit and could thus curb upsides for a couple of sessions. If Nifty closes below 14,500 level, a correction may eventually get extended towards the recent lows of 14,200 level,” he said.

Check out the
candlestick formations in the latest trading sessions

Chandan Taparia of Motilal Oswal Securities said the index needs to hold above 14,500 level to extend its move towards 14,750 and 15,000 levels. This analyst sees immediate support at 14,450 and 14,350 levels.

For the day, Nifty closed at 14,590 level, down 54.35 points or 0.37 per cent.

During the day, the index stumbled near the 123.6 per cent retracement of the recent decline i.e. near the 14,755 level.

“Nifty nosedived from the key Fibonacci level towards the end of the session. As a result, it couldn’t stay above the swing high of 14,653 on a closing basis and formed a bearish outside bar,” said Gaurav Ratnaparkhi, Senior Technical Analyst at Sharekhan.

“The Bollinger Band study suggests the daily upper Bollinger Band has become flat, which is putting pressure on the higher side, whereas the hourly bands have started contracting, which is suggesting consolidation. Thus, Nifty50 is expected to stay in a consolidation mode and is expected to trade in the 14,750 – 14,300 range in the short term,” Ratnaparkhi said.

Source link


Please enter your comment!
Please enter your name here