Technical View - March 26, 2021 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing steep weakness in the last two sessions, Nifty witnessed a sharp upside bounce on Friday and closed the day higher by 182 points. Nifty opened on an upside gap of 182 points (body gap, not a western gap) and shifted into a range movement for better part of the session. Intraday minor dips were used for buying and the opening upside gap remains unfilled.

A small positive candle was formed with minor upper and lower shadow. Technically, this could mean an upside bounce in the market from the lows. The previous opening upside gap (2nd Feb) has offer support for the market after violation on Thursday. So far, the lower tops were formed on the daily chart and present rise is likely to form another lower top around 14700 levels.

Nifty on the weekly chart has bounce back from the weekly 10 period EMA in this week. The moving average is now at 14590 and the Nifty closed just below it, as per week's close. Previously, such downside violations of this EMA has offered strong upside bounce in the subsequent weeks in past. Having recovered from the lows in the last two weeks, the odds of further upside bounce could be alive in the market.

Conclusion: The short term trend of Nifty seems to have reversed up with sharp upside bounce from near the supports. The next upside levels to be watched around 14700 and a sustainable move above this area could open further upside in the near term. On the dips, 14400-14350 could offer support for the markets.

Source : Equity Bulls

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