Technical View - Nov 6, 2020 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

Nifty continued its sharp up trended move for the fourth consecutive sessions on Friday and closed the day with handsome gains of around 143 points. Nifty opened on a positive note started to show sustainable upmove since early part of the session. Intraday dips have been used to buying for the day.

A long bull candle was formed post upside breakout of the crucial resistance of 12K Mark on the daily chart and the Nifty moved above the another hurdle of 12247 levels (swing high of mid part of Feb 20) and closed higher. Though, Nifty placed at the swing highs, still there is no indication of any reversal pattern at the highs. This is positive indication and the market is left by 170 points to scale into new all time highs.

Friday's sharp follow-through upmove could confirm a sustainable upside breakout of the recent consolidation pattern. The opening upside gap of Thursday remains unfilled two sessions after its formation. Hence, this gap could be considered as a bullish breakaway gap and this could signal more upside for the market ahead.

Nifty on the weekly chart, formed a long bull candle with the upside breakout of the one month range at 12025 levels. The market is now set to scale into new all time highs in the coming weeks (above 12430 levels). Weekly RSI has moved above 60 levels, which is suggesting further strengthening of upside momentum in the market.

Conclusion: The short term trend of Nifty continues to be positive. One may expect a formation of new all time high soon in the market (above 12430). A sustainable move above this hurdle could pull Nifty towards 12600-12700 levels in the next few weeks. Intra-week dips could be a buying opportunity for the near term. Immediate support is placed at 12150.

Source : Equity Bulls

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