INSUBCONTINENT EXCLUSIVE:
NEW DELHI: The Nifty50 plunged over 100 points on Thursday to settle close to its immediate support at 11,240
The index violated higher high and higher low formation and made a Bearish Belt Hold pattern on the daily chart
The index is likely to consolidate with a negative bias, with an initial target of 11,185 for the near term.
The index has decisively
broken its upsloping trendline of last nine sessions and support zone at 11,310 level on a closing basis, indicating a shift in the
bottom formation, indicating a bearish bias on the short-term charts
We expect this profit booking to continue towards 11,200 and 11,170 levels
or 0.89 per cent, to 11,244
Daily strength indicator RSI and momentum indicator Stochastic have turned bearish from the overbought zone, suggesting weakness ahead.
The
in the 11,210-11,185 range
Failure to hold on to this support zone may not only intensify the selling pressure, but also result in prolonged time-wise correction, said
Mazhar Mohammad of Chartviewindia.in.
Nagaraj Shetti of HDFC Securities said the 11,185 level is an unfilled opening upside gap for Nifty
from July 27 and an important lower support is now placed in the 11,150-170 range, which is the previous upside breakout point, as per the
concept of change in polarity.
Mohammad said traders will be better off adopting a neutral stance till some signs of strength get visible
On the upside, the momentum may not pick up unless the Nifty50 registers a close above 11,350, he said.
