Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities
After witnessing a sharp weakness on Thursday, Nifty shifted into a high volatility at the new swing lows of 15183 levels and closed the day lower by 67 points. After opening with a weak note, the market moved in a broader high low range of 15400-15183 levels for the whole session. The volatile swing movement has been witnessed for the day and Nifty closed near the lows.
A small body of positive candle was formed on the daily chart with upper and lower shadow. Technically, this pattern indicates high volatility in the market. Such pattern signals a formation of high wave type candle pattern. Normally, a formation of high wave after a reasonable decline or at the support signal an impending reversal post confirmation. Hence, there is a possibility of minor pull back from here or from the lows.
The market has been in a sharp down trend over the last 14-15 sessions. Minor consolidations or small upside bounces have resulted in a sharp weakness as of now. Hence, any upside bounce from here could be a sell on rise opportunity for the short term. On the higher side, the area of 15600 levels (mid part of Thursday's long bear candle) is expected to be a crucial overhead resistance ahead and is unlikely to be broken on the upside in a hurry. After a small upside bounce, the Nifty could slide down to the 15000-14800 levels in the near term.