NEW DELHI: Nifty50 on Tuesday snapped a four-day winning streak and negated a pattern of higher lows that it was making on the daily charts over the past five sessions. During the day, the index recovered from the opening lows, taking some support at its 50-day moving average.
The index ended up forming a bullish candle on the daily chart. Analysts see a near-term hurdle for the index in the 15,000-15,050 zone while support is likely in the 14,770-14,740 zone.
Gaurav Ratnaparkhi of Sharekhan said a falling trendline, the daily upper Bollinger Band and a key swing high are all present in the 15,000-15,050 range.
On the other hand, Ratnaparkhi finds immediate support for Nifty in the 14,770-14,750 zone, where the 40-hour exponential moving average, hourly lower Bollinger Band and the lower end of a reverse rising channel lie.
“A dip towards this support range can be taken as a fresh buying opportunity. The overall outlook continues to be positive. Once the consolidation gets over, the index is expected to eventually break out of the 15,000-15,050 barrier,” he said.
For the day, Nifty closed at 14,850, down 91.60 points or 0.61 per cent.
“The index held above the support of the 50-period moving average, whose value is placed at 14,737. If Nifty breaks below this average, there could be a decline to the 14,570-14,550 zone. For Nifty50 to move higher, it is imperative that it breaks above the 15,000-15,050 zone. Thursday’s session will see weekly expiry, when it could again be a low-volatility play,” said Independent analyst Manish Shah.
Mazhar Mohammad of Chartviewindia.in, however, is not looking much into the 50-day simple moving average, as the average has failed to act either as a support or resistance in this consolidation phase of last three months.
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This analyst is rather focused on Nifty50 sustaining above the 14,771 level. “A breach of that level can initially drag the index towards its 100-day simple moving average, whose value is placed around the 14,550 level and which has acted as a strong support in the past on a closing basis,” he said.
