Technical View - Dec 17, 2020 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

The upside momentum with range bound action continued in the market on Thursday, as Nifty displayed choppy movement at the highs and closed the day higher by 58 points. After opening on a positive note, Nifty continued to show gradual upmove with range bound action for the better part of the session. Minor profit booking was seen from a new all time high of 13773 levels towards the end.

Though, Nifty closed with the gains on Thursday, the overall market breadth was negative and broad market indices like midcap 100 and small cap 100 of NSE exchange have closed on a flat to minor negative note. This could be a cause of concern for longs at highs.

A small body of positive candle was formed with minor upper and lower shadow. Technically, this pattern indicate a formation of high wave or spinning top type formation at the highs, which apparently looks like reversal of present uptrend. But, the market has been moving up with range bound action and many such patterns have been formed recently and the Nifty continued to scale higher amidst a range movement. Hence, any negative implication arising out of this pattern could be ruled out.

Although market looks tired at the highs, the long term charts like weekly and monthly are intact and there is no indication of any reversal forming on the short term charts like daily and 60 min intraday timeframe.

Conclusion: The short term trend of Nifty continues to be range bound with positive bias and similar type of movement is expected in the coming session. The upside target for the Nifty remains around 13900-14000 levels, which corresponds multiple long term trend line resistances. Immediate support is placed at 13660.

Source : Equity Bulls

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