Friday’s swing low appears to have confirmed the formation of a new higher bottom in a bullish chart pattern that resembles a higher ceiling and bottom. Friday’s market action shows a false breakdown of the recent range, and a near-term breakout to the top is on the horizon.
Friday’s market action signals a strong comeback for the bulls after a volatile run, with further gains expected in the short term. The next upside target to watch is around the 25,200 level by next week. According to Nagaraj Shetty of HDFC Securities, the immediate support level is 24650.
In the open interest (OI) data, the highest OI on the call side was observed at strike prices of 24,800 and 24,900, while on the put side, the highest OI was at strike price of 24,700, followed by 24,600.
What should traders do? Analysts say:
Jatin Gedia, Sharekan
Since the index is forming an inside bar candlestick pattern on the weekly chart, the extreme values ​​of the previous candlestick, i.e. the levels between 24,858 and 24,009, are important levels to watch for next week. We expect this pattern to break to the upside and continue its strong momentum towards 25,125 next week. On the downside, 24,420 to 24,400 is an important support zone. The Nifty Weekly PCR showed an improvement from 0.70 to 1.04, suggesting bullish sentiment. Overall, we expect the positive momentum to continue.
Rupak De, LKP Securities
Indian stock market witnessed rollercoaster trading on Sensex weekly expiration date. At the lower end, Nifty found support near the neckline of an inverted head-and-shoulders pattern and completed a retest before rising towards higher levels. Today’s low also coincides with the 38.2% retracement level of the previous bull market. This trend is expected to continue strong and could reach over 25,000 in the short term. At the lower end, support is located at 24,550.
Devarsh Vakil, HDFC Securities
The short-term trend is bullish as it is above the 5-day, 10-day, and 20-day EMAs. Nifty seems to have regained its bullish momentum and is likely to head towards its next target of 25,000 contracts. The index’s support level is seen at 24,500.
(Disclaimer: Recommendations, suggestions, views and opinions by experts are their own. They do not represent the views of Economic Times)
