Technical Observation - May 11, 2020 - Nagaraj Shetti - Technical Analyst, HDFC securities

The lack of strength to sustain the highs continued in the market and Nifty closed the day on a slightly weak note, amidst a range bound action.We observe a formation of long negative candle today with minor upper shadow. Today's weak candle placed beside the similar negative candle of last session. This pattern indicates a choppy movement in the market in the last few sessions.

The Nifty failed to sustain after opening highs in the last 4-5 sessions. Most of opening upside gaps have been filled completely during intraday dips. This market action indicates lack of strength to sustain the highs. This could eventually result in a downside breakout of range (9450-9200) in the near term.

The bearish island reversal pattern, which was formed on 4th May is still intact (both the up and down gaps are unfilled). Hence, the downside pattern target to be watched at 8900. Immediate resistance is placed around 9400 for the short term.

Source : Equity Bulls

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