Technical Wrap - June 10, 2022 - HDFC Securities

Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing a fine upside recovery from the lows on Thursday, Nifty witnessed steep U turn on the downside on Friday and tanked lower by 276 points. After opening with a downside gap of 195 points (body gap, not a western gap), the market showed continues selling pressure through out the day. Minor intraday upside recoveries in between have been sold off and the Nifty closed near the lows.

A long negative candle was formed on the daily chart and that moved below the support of 16200 levels. Now, the supports have started to break down one after another and the market seems to have picked up downside momentum on Friday.

Nifty on the weekly chart formed a negative reversal candle on the downside. Formation of a long bear candle on the weekly chart signal a larger lower top reversal pattern at the swing high of 16793 levels. The larger degree of lower tops and bottoms was in force since last many months as per weekly timeframe chart and the Nifty now forming a new lower top reversal could hint at a possibility of more sharp weakness ahead.

Conclusion: After showing a range bound action with weak bias in the last few sessions, the Nifty seems to have turned into bearish mode on Friday with strong downside momentum. The near term outlook remains weak and any attempt of upside bounce from here could be short lived. The Nifty could eventually test the recent important bottom of 15735 levels in the near term.

Source : Equity Bulls

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TechnicalWrap HDFCSecurities Nifty Sensex