nifty50: Tech View: Nifty50 loses momentum, could enter consolidation phase
For the day, the index closed at 17,397.50, up 15.50 points or 0.09%
“The market may be losing momentum as the index saw a narrow move of 346 points for the week. Sell signals on some of the daily momentum oscillators are accompanied by overbought levels on the charts. weekly readings, possibly suggesting an impending decline.Weakness in the next session below 17,348 may take it towards 17,160.Strength can only be expected at a close above 17,500, which should extend the rally towards 17,800,” said Mazhar Mohammad of Chartviewindia.in.
The analyst advised traders to avoid long positions on the index unless it closes above 17,500.
Sharekhan’s Gaurav Ratnaparkhi said that Nifty50 posted a positive weekly close for the third week in a row, but the bullish momentum has slowed.
“Over the past two sessions, Nifty50 has been hovering around the 78.6% retracement of the April-June decline, which is near 17,500. There, the index formed a bearish outside bar and a candle Hanging Man on Thursday and an inside bar on the daily chart today. This shows the index is experiencing a brief distribution and preparing for near-term consolidation,” Ratnaparkhi said.
“17,000-17,500 should be the near-term consolidation range where the index should test the lower end of the range, i.e. 17,000 over the next few sessions,” he said. he adds.
Kunal Shah, Principal Technical Analyst at
said Nifty Bank has been witnessing sideways consolidation throughout the week and is stuck in a wide range between 37,200 and 38,200 levels. The index needs to break either side at the close for trending action, he said.
“The index on the intraday chart is trading in an oversold category and the profit booking scenario cannot be ruled out from current levels,” Shah said.
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