Technical View - Sep 6, 2021 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

The upside momentum continued in the market on Monday and Nifty closed the day with prominent gains of 54 points. After opening on a positive note, the market has shifted into a narrow intraday range movement from early-mid to later part of the session. The opening upside gap has almost been filled (left with small margin) and the new all time high was registered at 17429 levels.

A small negative candle was formed with minor upper and lower shadow. Technically this formation indicate a spinning top type pattern at the highs. Normally, such patterns at the highs/crucial hurdles more often act as a reversal after the confirmations of decline in subsequent sessions. Therefore, any reasonable decline on Tuesday could signal minor downward correction in the market.

But, on the other side, the Nifty has been in a sharp uptrended move with minimal decline in between. Minor negative patterns or consolidation movements recently have eventually taken out on the upside in the short span of time. Hence, there is a higher possibility of follow-through upmove in the market in the next session.

The long term charts like weekly is intact and suggest more upside in rest of the week, as we observe a decisive upside breakout of the narrow range movement in the last week, as per weekly timeframe chart.

Conclusion: The short term trend of Nifty continues to be positive. Though, Nifty formed a small range candle at the new highs, there is no immediate threat to a short term upside momentum for the Nifty. Initial upside targets to be watched around 17500-17600 levels in the next few sessions. Immediate support is placed at 17300 levels.

Source : Equity Bulls

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