Mr. Nagaraj Shetti, Technical Research Analyst
After showing minor consolidation type movement in the last couple of sessions, Nifty witnessed sharp upmove on Monday and closed the day higher by 190 points. After opening with a positive note, the market moved up further in the early part of the session. It later shifted into a consolidation in the mid part and the upside momentum picked up again in the afternoon to later part of the session and Nifty closed near the highs.
A long bull candle was formed on the daily chart with gap up opening. Technically, this pattern indicate sharp upside bounce in the market after a small dip. The smaller degree of higher highs and higher lows continued on the daily chart and Thursday's swing low of 17655 could now be considered as a new higher low of the sequence. The initial overhead resistance of 17950 has been broken on the upside and Nifty closed above it.
After the negation of larger bearish set up of lower tops and bottoms as per daily and weekly chart recently, the upside momentum has strengthened and the smaller dip in the Nifty is now signaling buying opportunity. The uptick of daily RSI above 60 levels on Monday is also reaffirming the strength of upside momentum in the Nifty.
Conclusion:The upside movement continued in the market after a small dip and the strength of upside momentum seems to be back in the market. The next upside levels to be watched around 18200/18350, which could be achieved in one week. Immediate support is placed at 17870 levels.