The Nifty managed to hold on to the psychologically vital 17,500-mark to close 10 points higher at 17,535 after a volatile session on August 10 as investors awaited US inflation data.
The index formed the Hanging Man pattern on the daily charts. A Hanging Man is a bearish reversal candlestick pattern usually formed at the end of an uptrend or at the top.
A major weakness is unlikely in the market, unless the index breaks the previous day's low of 17,359, though it is looking overbought after a 15 percent rally from June lows, experts said.
"The technical picture, at this juncture, appears to be mixed as bulls are making every effort to inch higher levels though, an indecisive formation like Hanging Man is registered in Wednesday's trading session," Mazhar Mohammad, Founder & Chief Market Strategist at Chartviewindia said.
Despite overbought readings on the daily as well as some weekly oscillators, the price chart is not displaying meaningful weakness, the market expert thinks.
If it sustains above 17,442, the index can head towards 17,800. Therefore, short-side traders should remain neutral and long-side players should keep a stop-loss below 17,440, he advised.
The broader markets closed on a negative note, with the Nifty midcap 100 index falling 0.16 percent and smallcap 100 index 0.35 percent on weak breadth. About 1,107 shares declined against 850 advancing shares on the NSE.
The volatility remained higher, with the India VIX climbing over the 20 mark during the day. It ended 1.47 percent higher at 19.59 level.
On the options front, maximum Call open interest was seen at 18,000 strike, which can be a crucial resistance, followed by 17,500 strike, with Call writing at 18,200 strike, then 17,500 & 17,700 strikes.
The maximum Put open interest was at 17,000 strike, which can be crucial support for the Nifty followed by 16,500 strike, with Put writing at 17,500 strike, then 17,000 strikes.
The data indicated that the Nifty may trade in the range of 17,300-17,700 in the coming sessions.
The Bank Nifty also remained volatile throughout the session after opening marginally higher at 38,299.
The index hit an intraday high of 38,403 and a low of 38,155 before closing 50 points higher at 38,288. It formed the Doji pattern on the daily chart, indicating indecisiveness among bulls and bears about the future trend.
" Immediate support and resistance for Bank Nifty are 37,700 and 38,750 respectively," Mohit Nigam, Head - PMS at Hem Securities said.Disclaimer: The views and investment tips expressed by experts on Moneycontrol.com are their own and not those of the website or its management. Moneycontrol.com advises users to check with certified experts before taking any investment decisions.