The Nifty traded higher for a sixth consecutive session to close at more than a four-month high of 17,825, up 127 points, on August 16.
The index, however, formed the indecisive Doji candle on the daily chart, raising doubts over the sustainability of the uptrend.
"Despite a strong gap-up opening, the intraday trading range remained at 75 points before the index signed off the session with an indecisive Doji kind of formation," Mazhar Mohammad, Founder & Chief Market Strategist at Chartviewindia said.
It is critical that in the next session, the index stays above 17,764-17,724, the day’s gap-up, as a lower close can induce selling pressure, with the initial target at 17,597 level.
But, if the positive momentum continues, the index can touch 18,100, Mohammad said.
It will be prudent to retain a neutral stance on the market till the index takes a dip or consolidates for a couple of sessions, the market expert said.
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The broader space also performed well. The Nifty midcap 100 and smallcap 100 indices gained 1.5 percent and 0.95 percent.
The market breadth was positive as about 1,164 shares advanced against 810 declining shares on the NSE.
India VIX was up by 0.44 percent to 17.69 levels. Volatility was slightly up but the below 20-level gave comfort to the bulls, experts said.
On the options front, seen maximum Call open interest was seen at 18,000 strike then 18,500 strike, while the maximum Put open interest was at 17,500 strike then 17,600 strike.
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Call writing was seen at 18,500 strike then 18,300 strike, while Put writing was witnessed at 17,800 strike then 17,700 strike.
The data indicates that the Nifty may remain in an immediate trading range of 17,600-18,000, while the broader range may be 17,400-18,200.
Banking index
The Bank Nifty opened more than 240 points higher at 39,284, and remained in positive terrain. It closed 194 points higher at 39,240, the highest closing since February 2.
The banking index also has formed a Doji pattern on the daily scale but formed higher highs from the fifth straight session.
"Now it has to hold above the 39,000-mark to make an up move towards 39,500 and 39,750 levels, whereas supports are placed at 38,888 and 38,750 levels," Chandan Taparia, Vice President | Analyst-Derivatives at Motilal Oswal Financial Services said.
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