NEW DELHI: Nifty50 on Tuesday breached its 20-day exponential moving average (EMA) on a closing basis. This was the third straight session when the index made a higher high-low formation. On the day scale, the index formed a bullish candle after forming two indecisive charts.
Analysts said the daily momentum indicators have turned in favour of the bulls. They believe Nifty may test the 14,750 level in the coming days.
During the session, Nifty saw a fresh bout of buying interest near the key hourly moving averages.
“On its way up, the index surpassed key daily moving averages on a closing basis. Also, the daily momentum indicators have turned in favour of the bulls, who now have an upper hand. Going ahead, the 14,700-14750 range will be the key area to watch out for. Once that range is taken out on a closing basis, the Wedge Pattern will be considered to have broken out on the upside and the index will be set for a significant upside. In that case, the 15,000 level will be the initial target on the upside with potential to stretch much higher,” said Gaurav Ratnaparkhi of Sharekhan.
For the day, Nifty closed at 14,653, up 168. points or 1.16 per cent.
ETMarkets.com“The index has swiftly moved higher from the recent swing low and surpassed its 20 EMA at close. On joining the recent swing highs and lows of the corrective phase, what we observed is that the index is trading in a ‘Channel’ and the higher end of this pattern is at 14,720-14,750. It also coincides with the gap area that was formed on April 9. The real test for the bulls will be this resistance. If the market has to march higher towards previous highs, then it will need to surpass this level with authority,” said Ruchit Jain of Angel Broking
Jain said any profit booking at this resistance could mean continuation of the corrective phase.
Check out the candlestick formations in the latest trading sessions
ETMarkets.comMazhar Mohammad of Chartviewindia.in believes as long as Nifty50 sustains above the 14,484 level, it can slowly head to test its 50-day simple moving average, whose value is placed around the 14,800 mark.
Mohammad said while there is a bearish gap zone in the 14,652-14,785 range registered on April 12, the 14,800 level cannot be ruled out in the next two sessions, given the monthly expiry.
