Technical View: Bulls back on D-Street! Nifty forms ‘Strong Bulls candle’ on charts

Bulls bounced back on D-Street after being knocked out in the previous trading session. Formation of a bullish candle after a long legged doji pattern confirms the bullish bias on the D-Street, suggest experts.

However, the momentum will strength once Nifty manages to break above 9900-9928 on a closing basis. Traders are advised to create fresh long positions only when index breaks above 9,928 levels.

“It was heartening to see Nifty50 recovering almost all losses as it registered a solid bull candle as bulls made a strong come back on the contributions from ‘laggards’ like pharma and IT,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.

“But, the real test lies in getting past 9928 levels, unless that happens traders should continue to remain cautious as even today’s bigger up move failed to generate any buy signals on our twin momentum oscillators and hence we advise traders to buy only the strength on a close above 9928 levels but not the dip,” he said.

Bulls emerged at lower levels as buying was seen across sectors with heavyweights which dragged the market down a few days back.

ITC, Reliance Industries and other sectors like BankNifty, metals, and FMCG contributed the gains climbing more than a percent.

If market continues its positive bias in Thursday’s session as well then stock specific focus can be maintained on the long side

“A bullish candlestick is observed after a Doji pattern on Tuesday confirming the buying momentum and undertone which is in place in near term,” Mustafa Nadeem, CEO, Epic Research told Moneycontrol.

“A doji followed by a bullish candlestick negated the selling pressure at higher levels with Nifty retracing back to 9900. A bullish confirmation is in place for the short term but it is critical to see as it can breach further major levels,” he said.

Nadeem further added that resistance is seen at 9,920 – 9,930 levels which if taken out then the trend may continue with next possible target of 10,000. “If the market cannot sustain the said resistances we may see a mild profit booking though overall range becomes 9950 - 9800 in very short term perspective,” he said.