Technical View - Nov 20, 2020 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing a sharp weakness from the new highs on Thursday, Nifty shifted into a consolidation with positive bias on Friday and closed the day higher by 87 points. A small body of positive candle was formed with minor upper and lower shadow, which indicate a consolidation movement in the market with positive bias.

The Nifty on the daily chart sustained above the immediate short term support of 10day EMA at 12680 levels. This action could mean that the short term uptrend status remains intact after a small downward correction and Nifty is expected to bounce up towards new all time highs.

The overall market breadth continues to be positive and broad market indices like midcap and small cap segments have closed on a decent gains of around 0.86% and 1.15% respectively. this is positive indication.

Nifty on the weekly chart formed a small negative candle with minor lower shadow. This pattern signal a breather type formation at the new highs, after a sharp upmove of the previous couple of weeks. Hence, this could also mean a lack of selling enthusiasm in the market post sharp upmove/at all time highs. The Nifty closed above the crucial long term up trend line resistance at 12800 levels.

Conclusion: The near term uptrend status remains intact and upside momentum is expected to continue after this small dip in the market. Hence, one may expect Nifty to move towards the new all time high of 12963 levels by next week. A decisive/sustainable move above 13000 levels could open next upside targets of 13500-13600 in the near term. Immediate supports to be watched at 12680-12730 levels.

Source : Equity Bulls

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