/Tech View: Nifty50 sees follow-up selling; 10,930 acts as key resistance

Tech View: Nifty50 sees follow-up selling; 10,930 acts as key resistance

NEW DELHI: Nifty50 on Monday settled below the 10,900 level, as the index formed a bearish candle on the daily chart, which was a follow through of Friday’s Evening Star formation. This has made a few analysts advise a sell on rise strategy for the coming session.

For now, the 10,930-10,995 level will pose as stiff resistance. Traders may keep any eye on Nifty Bank for further signs of weakness in the index, analysts said.

On Monday, the index fell 54.80 points, or 0.50 per cent, to 10,888.80. During the session, they index found some support from its 20-day moving average.

“Overall, the structure suggests that any bounce can be taken as an opportunity to initiate fresh short positions. Levels of 10,930-10,950 form a crucial area, where one can look to initiate a sell position. On the downside, 108,50-10,835 is an immediate support zone, below which the selling pressure can aggravate,” said Gaurav Ratnaparkhi, Senior Technical Analyst at Sharekhan.

The index has been forming lower highs – lower lows from last two trading sessions, said Chandan Taparia of Motilal Oswal Securities. This expert feels that a hold above 10,850 — which is the 50 per cent retracement from 10,583 to 11,118 level – is a must for the index to move towards the upside hurdle of 10,985. If the index fails to hold above 10,850, profit booking could continue towards next support at 10,777,” he said.

Nagaraj Shetti of HDFC Securities feels that the daily charts are indicating weak bias amidst a range movement. Immediate supports to be watched at 10,815,” Shetti said.

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