Tech View: Doji on daily, Hammer on weekly chart show consolidation
Nifty has immediate support in 10,920-10,850 and resistance around the 11,100-11,150 zone.
“The long shadows on the daily charts seen in last two sessions, along with positive closes, suggest Nifty is in for consolidation with a near-term bottom in place around 10,900,” said Mazhar Mohammad of Chartviewindia.in.
As long as the index sustains above the said low, one can expect a breakout above the 28-day-old descending channel, which is in progress from the July high of 11,981, Mohammad said.
For the day, Nifty rose 18.40 points, or 0.17 per cent, to 11,047. The index hit an intraday low of 10,924 during the session.
“The daily chart shows the index is forming a triangular pattern, which can continue for some more time. Once the sideways action, which is Wave IV as per the Elliott Wave theory, is done with, we can witness the next leg down south,” said Gaurav Ratnaparkhi of Sharekhan.
“Hourly chart reveal a falling trendline, which put a cap on the upside on Friday for the fourth straight session. On the other hand, a rising trendline is acting as a support for the index. Thus, a breach of the swing low of 10,901, which is also the breakout level for an Arrow pattern formed on the daily chart, would be the first sign of the next down leg,” Ratnaparkhi said.
The index has immediate support in the 10,920-10,850 range and resistance around the 11,100-11,150 zone, said Rohit Singre of LKP Securities. “If it manages to sustain above 11,150, then we may see a good move towards 11,350,” Singre said.