Tech View: Nifty forms a bullish candle; follow-through buying instils confidence

NEW DELHI: Nifty50 climbed 1 per cent on Friday to close near the 12,250 mark. In the process, it formed a bullish candle on the daily chart and an indecisive candle on the weekly chart. A follow-through buying may instill confidence among traders, analysts said.

“Nifty rebounded sharply after a minor degree correction in the last few sessions. This shows that the underlying tone of the market continues to be bullish. Participation was seen in the broader market as well, which augurs well for the overall market rally. Traders can initiate fresh long positions once the swing high of 12,294 is taken out,” said Gaurav Ratnaparkhi of Sharekhan

Ratnaparkhi believes the levels around the 12,350-12,400 zone will be a key short-term target area to watch out for. He sees support in the 12,150-12,100 zone.

For the day, Nifty rose 119.25 points, or 0.98 per cent, to 12,245.

“Nifty50 made a strong comeback, as it erased all the losses of Thursday’s F&O expiry session, but formed a Doji candle on the weekly charts, which is a cause for concern. Hence, it can be too early to say that a short-term bottom is in place at last Thursday’s low of 12,118 level, but the outlook for the next few sessions remains positive as long as Nifty sustains above 12,157,” said Mazhar Mohammad of Chartviewindia.in.

“On sustaining above the said level, Nifty may aim to retest its recent high at 12,293. In case it breaches the 12,157 level, the recent low of 12,118 shall once again come under threat,” he said.