Nifty50 appears to be taking support around its 27-day-old ascending channel, as it is bouncing back after testing the lower boundary of the channel for the last two sessions, said Mazhar Mohammad of Chartviewindia.in.
“Most corrections in the past halted after testing the 13-day simple moving average and this has offered support thrice since August. For the bears to gain an upper hand, they need to breach this average on a closing basis. As the said average value is almost coinciding with the channel support placed at the 17,600 level, a close below the 17,570 level will amount to a breakdown on the short-term charts,” Mohammad said.
For the day, the index closed at 17,711, down 37.30 points or 0.21 per cent.
Gaurav Ratnaparkhi of Sharekhan said the index is in consolidation mode post a brief distribution near the daily upper Bollinger Band in the last few sessions.
“The hourly chart shows Nifty is facing resistance near the key hourly moving averages and is expected to form the next leg down from the current level. Thus, the index can test the 17,500 and 17,400 levels on the downside. Overall, Nifty50 is expected to witness short-term consolidation in the 17,400-17,900 range,” Ratnaparkhi said.
Shrikant Chouhan said Nifty has formed an Inside Candle, which indicates indecisiveness among the market participants. “In the runup to the monthly F&O expiry, the index may continue with narrow-range activity. For day traders, the 17,800-17,850 zone would be the key resistance level while the 17,625-17,590 zone could act as a strong support,” he said.