Technical View - May 17, 2021 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities
(Time Zone: UTC)
After showing weakness amidst a range movement in the last couple of sessions, Nifty witnessed a sharp comeback on Monday and closed the day with hefty gains of 245 points. After opening on an upside gap of 79 points, Nifty shifted into a sustainable upmove, which lasted for the whole session. Intraday dips in between were used as a buy on dips opportunity and Nifty closed near the highs. The opening upside gap remains unfilled.
A long bull candle was formed on the daily chart, which indicate a display of sharp upside momentum near the overhead resistance. Nifty is repeatedly testing key overhead resistance and also broader upper range of around 14950-15000 levels. The upmove of Monday has confirmed the new higher bottom of 14591 - low of Friday. This consistent higher bottom formations and repeated testing of upper range could mean that the market is gathering strength to witness a sharp upside breakout of 15K mark in the near term.
Having placed near the crucial 15000 levels, there is a possibility of one more round of small downward correction from near 15000-15100 levels in the next couple of session, before showing sustainable upmove again from the lower levels. Hence, any dips from here is going to be a buy on dips opportunity in the market.
Conclusion: The short term trend of Nifty seems to have reversed up firmly, after a reasonable weakness of the last few sessions. Having placed at the crucial overhead resistance around 15000 levels, there is a possibility of volatility emerging or minor downward correction from the highs in the next few sessions and that is going to be a buy on dips opportunity in the market. Immediate support is placed at 14780 levels.