Technical View - Sep 7, 2020 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing weakness on Friday, Nifty shifted into a consolidation on Monday and showed minor upside recovery from the lows and closed the day on a minor positive note. A small body of negative candle was formed with long lower shadow. This pattern indicates a formation of doji type candle pattern. This market action could indicate an opportunity of minor upside bounce in the next session.

After moving below the multiple supports like uptrend line and 20 day EMA on Friday around 11380-11360 levels, the said area has acted as a key overhead resistance in today's session. The opening downside gap of Friday remains intact.

The formation of lower high of 11584 of 3rd Sept, presence of Nifty below the key multiple supports and the formation of significant bearish engulfing pattern of 31st Aug are all pointing towards limited upside possibility from here and there is a chances of a resumption of weakness from the highs in the next few sessions.

The bearish engulfing pattern on the weekly chart is also intact, hence any rising attempt from here could encounter selling pressure at the highs. The last week's high of 11794 could be considered as a near term top for the market as of now.

The near term negative trend status remains intact for the market and any upside bounce from here upto 11450-11500 is going to be a sell on rise opportunity. Immediate supports to be watched around 11350-11300 levels for the next few sessions.

Source : Equity Bulls

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