Technical View - Jan 4, 2021 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing a sideways range movement in the last few sessions, the market has witnessed a sharp upmove amidst a volatility on Monday and closed the day higher by 114 points. Nifty opened on an upside gap of 86 points, shifted into an intraday range movement in the early part of the session. A sharp intraday dip has led to fill the opening upside gap completely, which was followed by convincing upside bounce from the lows.

A small positive candle was formed with long lower shadow. Technically, this pattern indicate a possibility of an upside breakout of a small high low range in the market. This is positive indication and one may expect further upside in the coming session. The overall market breadth was positive on Monday and broad market indices like midcap and small cap segments have closed higher by 1.41% and 1.23% respectively.

We observe positive sequential movement like higher highs and higher lows as per daily timeframe chart. One day sharp declines have been resulting in a strong upside bounces in the subsequent sessions so far. Though, Nifty placed at the new high of 14147, still there is no indication of any reversal forming at the highs. Any one day dips in the next few sessions could be a buying opportunity in the near term.

Conclusion: The short term trend of Nifty continues to be positive. Further sustainable upmove from here could mean upside breakout of the small high low range for the market and that could result in some more upside in the near term. The short term upside targets to be watched at 14350 and immediate support is placed at 14060.

Source : Equity Bulls

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