Technical View - July 3, 2020 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

The upside momentum continued in Nifty for the third consecutive session and closed the day decently higher by 55 points. A small body of negative candle was formed on Friday at the new swing high of 10630. Range bound action was seen with positive bias for the better part of Friday's session and the opening upside gap has been filled.

Nifty is currently nearing a key overhead resistance around 10650-700 levels, but there is no indication of any reversal type pattern at the highs. The positive sequential movement like higher tops and bottoms continued on the daily chart and Nifty is in the process of forming a new higher top of the sequence. Still there is no confirmation of any higher top reversal at the highs.

Nifty as per weekly chart formed a long bull candle, that has engulfed the small range high wave type candle pattern of last week. Nifty is now placed at the key resistance of 10650 on the weekly chart as per change in polarity (previous swing low of Jan-Feb and Aug-Sept 2019)

The short term trend of Nifty continues to be positive. The choppy movement at the upside could continue in the early part of next week. The overhead resistance of 10650-10700 is expected to weigh high for the Nifty in next week. Hence, minor profit booking from the highs is likely. A sustainable move only above 10700 could open up next upside targets of 11000-11200 in the next couple of weeks.

Source : Equity Bulls

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