Technical Observation - March 24, 2020 - Nagaraj Shetti - Technical Analyst, HDFC securities

After witnessing a historical one day weakness on Monday, Nifty witnessed a relief rally on Tuesday amidst volatility. A high wave type candlestick pattern was formed on the daily chart at the new swing low of 7512 levels. This pattern signals some hopes for bulls to make a comeback from the lows. But, there is no confirmation of any bottom reversal at the lows as of now.

Previously, one day upside bounce have failed to sustain in subsequent sessions in the last three occasions. Hence, there is a possibility of an emergence of weakness from the highs in the next 1-2 sessions.

The near term trend of Nifty is still negative and the upside bounce could be considered as a temporary before another round of fall. The next downside target of 6825 remains intact (which is an important bottom reversal of Feb 2016).

Source : Equity Bulls

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