Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities
After showing sharp weakness in the last couple of sessions, Nifty shifted into a high volatility on Tuesday and closed the day lower by 08 points. After opening with a positive note, the market moved up further soon after the opening. It failed to sustain above 17170-17150 levels in multiple attempts and finally closed near the lows.
A reasonable negative candle was formed on the daily chart, that has placed beside the similar negative candle of previous session. Technically, this pattern signal broader range bound action in the market with weak bias. This pattern also indicates a lack of strength in the intraday upside bounce. This is not a good sign and one may expect further weakness in the short term.
Nifty is temporarily halting its weakness near the crucial lower support of 16800 levels, as per the concept of change in polarity. The area of 16800 has acted as an important value area and has resulted in significant movement from its support/resistance/breakouts in the past. Hence, having declined swiftly from the highs of 18K mark this time, there is a possibility of a sustainable upside bounce in the market from near this support. Immediate resistance is placed around 17150-17200 levels.