Technical View - July 12, 2021 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities
(Time Zone: UTC)
The market was not able to sustain the intraday gains on Monday and closed on a flat note. Nifty opened on an upside gap of 76 points, made an attempt to move up soon after the opening. It later shifted into range bound movement for some time and later showed sharp intraday weakness in the afternoon to later part of the session. The opening upside gap has been filled completed.
A reasonable negative candle was formed on the daily chart after opening higher on Monday. Technically this action signal instability of bulls to sustain the highs. The market was not able to surpass the crucial resistance of 15800 (resistance as per the concept of change in polarity) and showed weakness from the highs.
The immediate support of 15630-15650 came into play once again on Monday and resulted in a minor upside recovery towards the close. Now, the intraday double bottom formation and a doji pattern at 15635 remains intact.
Nifty on the weekly chart, formed negative candles with narrow range movement in the last couple of weeks and similar movement continued till now. If support of the last two weekly low breaks on the downside at 15635, then the next support of 10 week EMA could come into scene at 15515 levels.
Conclusion: The choppy trend continued in the market and there is no respite for bulls, after showing upside bounce from the lower support (15635) in previous session. As long as the support holds, the odds of market bounce back remain alive for the next 1-2 sessions. A decisive move below the support is likely to extend weakness to 15500 levels. On the upside bounce, the area of 15800 could be a crucial resistance to be watched.