Technical Observation - April 21, 2020 - Nagaraj Shetti - Technical Analyst, HDFC securities

After showing higher level weakness on Monday, Nifty slipped into a sharp weakness on Tuesday on the back of weak global cues and closed the day lower by 3.00%. A small negative candle was formed on Tuesday with sharp gap down opening. The opening down side gap remains unfilled.

On the daily chart, Nifty has been moving in an ascending channel type pattern and is currently placed near the lower end of a channel around 8850-8800 levels. Hence, this lower area could now act as a key lower support for the Nifty in the short term.

The positive sequence of higher tops and bottoms continued and a sustainable move above 8820 levels could signal a formation of higher bottom of the sequence.

The short term trend of Nifty is weak, as long as the support of 8800 levels holds in the next few sessions, there is a possibility of an upside bounce from the lower levels. This expected upside bounce from the lows could take Nifty up to 9200-9300 levels in the near term.

Source : Equity Bulls

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