Technical View - Dec 8, 2021 - Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing a sharp upside bounce from the lows on Tuesday, the strong upside momentum continued in the market on Wednesday and the Nifty closed the day with hefty gains of 293 points. After opening with an upside gap of 139 points, the market moved up further in the early part of the session. It later shifted into a range movement and that continued for the whole session. Intraday dips in between has been bought into and the market closed near the highs. The opening upside gap remains unfilled.

Another long bull candle was formed on the daily chart with gap up opening. The upmove of the last two sessions has erased the negative sentiment created by last Friday and this Monday. This is positive indication for the short term.

Nifty is currently placed at the crucial overhead resistance of 17500-17550 levels, which is previous swing highs and lows as per the concept of change in polarity. This area has proved to be a crucial value area as the Nifty moved down sharply below this area for two occassions in the past. Hence, a sustainable move above this resistance zone is likely to open further sharp upmove in the short term.

Conclusion: The bulls have gained upside momentum in the last two sessions and the market is now placed at the important juncture. A decisive move above 17550-17600 levels could open further sharp upside towards 18K mark in a quick period of time. Any failure to sustain above this area is likely to trigger weakness from the highs towards the low of 17250-17200 levels in the near term.

Source : Equity Bulls

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