Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities
After witnessing a sustainable upmove in the last seven sessions, the market seems to have started selling pressure from the all time highs of 20100 levels on Tuesday with broad market indices like midcap and small cap witnessing sharp sell off from the all time highs. After opening with an upside gap of 114 points, the market failed to sustain the opening gains and slipped into sharp intraday weakness in the early part of the session. It later shifted into minor upside recovery in the mid part and finally closed the day near the lows.
A long bear candle was formed on the daily chart at the all time high of 20110 levels and closed near the previous sessions close. Though, this market action indicates minor reversal in nature, but we need confirmation by the way of more weakness in the next session to call this as a top reversal.
The sharp sell off in broad market indices are indicating more weakness ahead for the benchmark Nifty in the coming sessions. A decline below 19850 levels could confirm short term top reversal pattern for the market. Any upside rally from here could find strong resistance around 20100 levels.