NEW DELHI: Nifty50 jumped nearly 250 points on Monday and zipped past the 14,900 mark on a closing basis. In the process, the index breached its 50-day and 5-day moving averages. With this, the index has come closer to its immediate resistance range in 15,000-15,050. A decisive breach of the said range can open up the gates for strong gains ahead.
The 15,000-15,050 range is a barrier that halted many advances in the past couple of weeks, said independent analyst Mahesh Shah.
“The MACD indicator is in the ‘buy’ mode and Nifty50 has moved above the 50-period moving average. A crucial piece of evidence now needed is a high conviction close above the 15,050-15,100 zone. Once that happens, we can brace for a rally to the prior swing high in the 15,430-15,450 zone. A breakout should signal a sharp rally over the next couple of weeks,” Shah said.
For the day, Nifty closed at 14,923, up 245 points or 1.67 per cent.
ETMarkets.comSameet Chavan of Angel Broking hoped Nifty50 has reclaimed the 14,9000 level and hopes it doesn’t deceive traders the way it did in the previous week.
“It looks like we are going to head higher from here on because the authenticity of any move is measured by the quality of participation in it. On Monday, the banking space led front the forefront with a humongous intraday rally. When this pocket contributes heavily, the bounce is considered a genuine one. We will not be surprised if Nifty50 crosses the 14,967 level in the opening tick on Tuesday and marches towards 15,044 and beyond,” Chavan said.
He said the 14,850-14,790 range offers intraday support to Nifty.
“Technically, the index has formed a healthy bullish candle on the daily scale and negated the formation of lower highs and lows after three sessions. Now, it has to hold above 14,900 level to witness a bounce towards 15,050 and 15,150 levels,” said Chandan Taparia of Motilal Oswal Securities. He sees support for the index at 14,700 and 14,600 levels.
Check out the candlestick formations in the latest trading sessions
ETMarkets.comMazhar Mohammad of Chartviewindia.in said the larger trend continues to be sideways, unless Nifty50 registers a strong breakout above 15,000 level on a closing basis.
“The price action in the last 50 trading sessions evolved into some sort of a descending channel with valid touch points. As Nifty trades close to the upper boundary of the said channel, a close above 15,000 level can facilitate a sustainable bounce with bigger targets. Nifty50 needs to sustain above 14,725 level to retain its bullish stance, as a close below this level can once again embolden the bears. Traders are advised to wait for a breakout, before initiating long positions on the index,” Mohammad said.
