Market Commentary

Technical Wrap - Oct 7, 2022 - HDFC Securities

Posted On : 2022-10-07 22:59:17( TIMEZONE : IST )

Technical Wrap - Oct 7, 2022 - HDFC Securities

Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities

After showing weakness from the upper resistance of around 17400 levels on Thursday, Nifty shifted into a consolidation with weak bias on Friday and closed the day lower by 17 points. After opening with a negative note, the market showed weakness in the early mid part of the session. Sustainable upside recovery has emerged from the day's low of 17216 levels in the mid to later part and Nifty closed near the highs.

A small positive candle was formed on the daily chart with upper and lower shadow. Technically, this pattern indicates a formation of high wave type candlestick pattern. Having declined from the hurdle of 17425 levels on Thursday, Nifty forming such high wave pattern indicates minimal negative impact on the market post weakness from the hurdle. Hence, this is also signaling that the market could retest the abovesaid resistance in the short term and eventually the resistance could be broken on the upside.

Nifty on the weekly chart formed a long bull candle with upper and lower shadow. Hence, this pattern could be a confirmation of bullish hammer pattern that formed in the last week.

Conclusion: The underlying uptrend of Nifty remains intact. The consolidation movement may be extended in early part of next week and the market could eventually witness sharp upside bounce from the lows by next week. A decisive upside breakout of the hurdle of 17450 is likely to pull Nifty towards another important resistance of 18000-18100 levels. Immediate support is placed at 17200 levels.

Source : Equity Bulls


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