Technical View - June 16, 2021 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing lackluster type of movement in the last three sessions, Nifty slipped into a sharp weakness on Wednesday and closed the day lower by 101 points. Nifty opened on a negative note, made an attempt to move up in the early part of the session. Sharp intraday weakness got triggered in the early mid part of the session, before showing minor intraday upside bounce from the lows. The weakness got intensified in the afternoon to later part and Nifty closed near the low.

A long negative candle was formed on the daily chart on Wednesday, after a doji type pattern at the new highs (15901) on Tuesday. This again raises concern over the sustainability of bulls at the new highs. At the same time, the market has failed to show any decisive declines beyond one day weakness recently.

After the formation of negative indications like doji, hanging man and doji candle patterns on Friday, Monday and Wednesday (as per daily chart), the weakness was anticipated in the subsequent session. The Nifty has been sustaining above the immediate support of 10 day EMA over the last 4-5 weeks and is now placed near the said moving average support at 15715 levels. Hence, a decisive move below this support is likely to open sharp weakness in the market.

Conclusion: The short term trend of Nifty seems to have shattered by Wednesday's decline. The immediate support of 15715-15700 is going to be crucial for a sustainability of uptrend. A decisive move below this support could confirm trend reversal and also a crucial top formation at 15901 levels. Any pullback rallies could find resistance at 15825-15850 levels.

Source : Equity Bulls

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