market outlook: Tech View: Nifty50 forms bullish candle, but can test 10,000 mark

NEW DELHI: Nifty50 on Wednesday halted a falling spree, but failed to close in the black. Yet, it formed a bullish candle on the daily chart.

During the day, the bulls managed to defend the recent low of 10,294. Analysts said sustainability of this level would be ‘crucial’ for the market bias to turn positive. A up-move above the 10,550 level could trigger more upside, they said.

A reasonably positive candle got formed for the day, but Nifty failed to sustain the intraday gains till the end, said Nagaraj Shetti of HDFC Securities.

“This pattern indicated a temporary halt to the downside momentum. The possibility of a minor bounce can’t be ruled out in next 1-2 sessions. The immediate resistance is placed in the 10,550-10,600 zone,” Shetti said.

For the day, the index closed at 10,448, down 2.55 points or 0.02 per cent. This was the third day of slide for the index.

“On the higher side, the lower end of a breached falling channel, which is near the 10,550-10,600 zone, will act as a key resistance. Hourly charts showed Nifty has entered a minor degree consolidation phase, which can continue in the 10,300-10,600 range,” said Gaurav Ratnaparkhi of Sharekhan.

Mazhar Mohammad of Chartviewindia.in expects Nifty to test the bearish gap zone between 10,751 and 10,827 levels registered on March 9, if it stays above 10,550 level next session.

“Fresh short position can be initiated once Nifty breaks the swing low of 10,294. The overall structure shows the index is poised to test the key psychologically important 10,000 mark, which is near the previous Wave IV low as per the Elliott Wave Theory,” Ratnaparkhi said.