Technical Wrap - March 4, 2022 - HDFC Securities

Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing higher levels weakness from near the hurdle of 16800 levels on Thursday, Nifty continued with down trend on Friday amidst volatility and closed the day lower by 252 points. After opening on a weak note, the market slipped into declines in the early part of the session. The sharp intraday upside recovery of mid part was sold off at the hurdle of 16450 levels and the Nifty reversed down in the later half to close near the lows.

A reasonable negative candle was formed on the daily chart with upper and lower shadow. This chart pattern indicate a continuation of weakness in the market with high volatility. This could be considered as a down trend continuation pattern.

The strong overhead resistance of 16800-17000 levels as per change of polarity has been left with unchallenged. The significance of this resistance could mean more weakness for the market ahead. The initial support of 16250 levels has been broken on the downside and the Nifty closed just below it.

Nifty as per weekly chart continued with down trend for this week. A follow-through negative candle was formed on the weekly chart after a decisive downside breakout of the crucial support at 16800 levels. This is negative indication and one may expect further weakness in the near term.

Conclusion: Formation of range movement at the lower high has eventually resulted in a downside breakout. The overall chart pattern signal more weakness for the Nifty ahead and the new swing lows of around 15800 could be registered in the next 1-2 weeks. Immediate resistance to be watched at 16400 levels.

Source : Equity Bulls

Keywords

TechnicalWrap HDFCSecurities Nifty Sensex