Analysts see downside support at 9,861, a breach of which should be read as end of the pullback rally. NEW DELHI: The Nifty50 reclaimed the 9,950 mark on Tuesday and in the process made a ‘Harami’ candle on the daily chart.
In a two-candlestick bullish Harami, a large candlestick (Bearish Engulfing Pattern on Monday) is followed by a small candlestick, where the body of the smaller candlestick is located within the vertical range of the previous session’s body.
The pattern often indicates that the bearish trend may be reversing. “The Nifty50 formed a ‘Haramai candle’ as it traded inside the trading range of last session. It stabilised after a sharp drop on Monday. But the index needs to hold above 9,928 to head towards multiple hurdles at 9,980 and 10,020 levels,” said Chandan Taparia of Motilal Oswal Securities.
Taparia expects the index to find support at 9,880 and 9,850 levels. At close, the Nifty50 was up 39.35 points, or 0.40 per cent, at 9,952.
Mazhar Mohammad, Chief Strategist of Technical Research & Trading Advisory, Chartviewindia.in, said momentum traders should look out for a close above 9,988 as a breach above that should push the Nifty50 towards the 10,080 level.
“With a positive AD line and bullish signal on the daily MACD oscillator, the near-term outlook for the next few sessions can be positive. But upsides should be capped, unless the market witnesses a fresh breakout beyond the 10,137 level. Till that happens, traders are advised to read this rally as of pullback and meant only to lighten up long positions,” Mohammad said.
Analysts see downside support at 9,861, a breach of which should be read as end of the pullback rally.
Mustafa Nadeem, CEO at Epic Research, expects the Nifty50 to face resistance at 9,990 and 10,020 levels, and have support at 9,910 and 9,870 levels.
“The bulls may need to protect these supports to keep sailing to higher levels while the bears have the last hope as 9,970, which if taken out, the knockout may be seen for the bears as we approach higher levels,” he said.