Technical View - June 17, 2021 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities
(Time Zone: UTC)
After showing weakness on Wednesday, Nifty slipped into decline amidst a volatility on Friday and closed the day lower by 76 points. After opening on a downside gap of 94 points, Nifty made an attempt to move up in the early part of the session. The upside recovery attempt faltered in the early-mid part as the market turned down from the day's high. A reasonable buying has emerged from the lows towards end. The opening downside gap has been filled completely.
A small positive candle was formed at the lows with long upper shadow. Technically, this signal a follow-through weakness with high volatility. Nifty has broken the sequence of one day decline, as it witnessed back to back declines for two sessions on Thursday, after the span of 19 sessions. Hence, this action signal strength of profit booking which has emerged from the new highs. This is not a good sign for bulls to sustain the highs.
The crucial support of 10 day EMA has been broken lower (the market was sustaining above this moving average support since past one month) and Nifty closed below it. Now the market could slide down to another important support of 20 day EMA, which is currently placed around 15550 levels.
Conclusion: The short term trend of Nifty seems to have reversed down with the short term top reversal at 15901 (15 June). The next downside levels to be watched around 15550 in the next couple of sessions, before showing another round of minor upside bounce. Any upside rally towards 15750-15800 could be a sell on rise opportunity for the coming sessions.