Tech View: Nifty50 forms indecisive Spinning Top, resistance at 12,100

NEW DELHI: Nifty50 gave away much of Tuesday’s morning gains and ended up forming an indecisive Spinning Top on the daily chart.

Analysts said the 11,980 level should act as a key support for the index, while the 12,100 level may pose a strong resistance.

“Don’t expect strength in Nifty unless it closes above Monday’s bearish gap in the 12,179-191 zone. For the time being, the index appears to be defending its 50-day exponential moving average, whose value is placed around the 11,980 level. The consolidation is expected to continue as long as Nifty sustains above this level. A fall below the 11,974 level can trigger weakness,” said Mazhar Mohammad of Chartviewindia.in.

During the day, Nifty50 faced resistance at the 12,150 level as it respected the 12,000 level throughout the session. It eventually settled 59.90 points, or 0.50 per cent, higher at 12,052.

The uptrend has been fractured, said Amit Shah of Indiabulls Ventures.

This analyst expects the 12,100 level to remain a key resistance on a closing basis. “Traders should have a ‘sell on rise’ approach on Nifty,” he said.

Mohammad advised traders to remain neutral on the index till a directional move emerges. “For the time being, we advise traders to remain neutral on the long side. Fresh shorting should be considered on any close below the 11,980 level with targets close to 11,830 level,” he said.