Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities
The choppy movement continued in the market on Wednesday and Nifty closed the day lower by 32 points amidst volatility. After opening with a positive note, the market has started with upside recovery since opening. The gradual upmove continued for better part of session and selling pressure has emerged from the highs towards the end. The opening downside gap has been filled completely.
A long bull candle was formed on the daily chart after opening lower. This is back-to-back second such pattern in the last two sessions, which signal range bound movement in the market. After the false upside breakout of 15800-15900 levels on Monday, Nifty has declined gradually in the last two sessions, which could be a positive indication for the bulls to make a comeback from the lows. Normally, such range movements from near important resistances eventually result in sharp upside bounces from the lows.
Minor degree of positive sequence like higher tops and bottoms is intact on the daily chart and current weakness could in line with the formation of new higher bottom of the sequence. There is no confirmation of any higher bottom reversal as of now.
Conclusion: The short term trend of Nifty continues to be choppy with negative bias. The present range bound movement could continue for the next 1-2 sessions and immediate supports to be watched around 15600-15650 levels. On the flip side, a decisive move above 15850-15900 levels is likely to open a sustainable upside for the market.