Technical View - May 5, 2021 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing a sharp sell on intraday rise action on Tuesday, Nifty shifted into a sustainable upmove on Wednesday and closed the day higher by 121 points. Nifty opened on a positive note and later shifted into a broader range movement, which lasted for the whole session. Intraday minor dips were used to move up and the buying has strengthened in the later part of the session. Nifty closed near the highs.

A small positive candle was formed with long lower shadow, which indicates a hammer type of formation. But the market action of today was limited to a high low range of Tuesday. Hence, this formation could be considered as a inside day, which signal a range movement with positive bias for the market.

After showing a lack of strength to sustain the highs on Tuesday, Nifty showed a buy on dips action on Wednesday. The immediate support of 14415 was not challenged, which could signal that the Tuesday's negative candle's high could be taken out on the upside at 14723 levels in the short term.

A sustainable move above 14725 levels could confirm the recent swing low of 14416 of 3rd May as a crucial higher bottom formation and such higher bottom formation is expected to open doors towards 14900-15000 levels in the near term.

Conclusion: The short term trend of Nifty remains dicey with one day of negative and positive movements. At the same time, the immediate support of 14415 seems to be holding and a sustainable move above 14725 could open fresh buying enthusiasm in the market. On such formation more upside could be expected. Any failure to sustain above 14700 levels is likely to trigger another sell on rise from the highs.

Source : Equity Bulls

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