Technical View - Sep 3, 2020 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

Nifty continued with lackluster type movement on Thursday and moved in a narrow high low range of 77 points for the whole session. On the day of weekly F&O expiry, the volatility was muted and Nifty finally closed on a slightly negative note.

A small negative candle was formed on Thursday with minor upper and lower shadow. Technically, this pattern signal a formation of high wave type pattern. Having formed this pattern amidst a range movement, the predictive value of this pattern could be less.

Nifty is in the sequential formation of range movement with upmove. Similar market action was formed during 21st to 28th of August and Nifty eventually witnessed sharp weakness from the highs (11794) on 31st August. According to this pattern, one may expect similar type of range movement with positive in the next few sessions.

Though, Nifty bounced up in the last three sessions, the the bearish engulfing pattern, which was formed on 31st Sept remains intact, as long as Nifty stays below 11794 in the near term. But, possibility of minor intraday profit booking at the highs could not be ruled out.

The short term trend of Nifty remains choppy with minor positive bias. There is a possibility of similar range movement with positive bias in the next 1-2 sessions. Immediate resistance to be watched at 11600 and the short term lower support is placed at 11450.

Source : Equity Bulls

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