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Nifty forms bearish candle; level of 9,850 crucial

Yatheendradas C.k. at 09:49 PM - Oct 05, 2017 ( ) Views: 604


Oct 05, 2017 04:54 PM IST | Source: Moneycontrol.com

Technical View: Nifty forms bearish candle; level of 9,850 crucial for bulls

The Nifty index which opened at 9927 rose to an intraday high of 9945. It slipped to an intraday low of 9881.85 before closing the day 26 points lower at 9,888.70.

Kshitij Anand   Moneycontrol News

The Nifty50 which opened higher in morning trade failed to hold on to momentum and slipped below its crucial support level of 50-days exponential moving average (DEMA) and 9,900 on Thursday. The index made a bearish candle on the daily candlestick charts.

The Nifty index which opened at 9927 rose to an intraday high of 9945. It slipped to an intraday low of 9881.85 before closing the day 26 points lower at 9,888.70.

The index closed below its crucial short-term moving averages such as 50-DEMA, 20-DEMA, 10-DEMA, and 13-DEMA. If the weakness sustains and the index slips below 9850 the selling pressure could accelerate which could take it towards next support placed at 9737.


The Nifty50 made a bearish candle after forming a bullish candle in the previous trading session which suggests that there is a tussle between the bulls as well as the bears. Investors are advised to tread with caution as index could move in either direction.

“The Nifty50 registered a small bearish candle as it is struggling to get past the resistance levels placed around 50-Days Moving Average. Interestingly, this kind of supply pressure is occurring around 50% retracement level of its fall from the highs 10179 whose value is placed around 9933 levels,” Mazhar Mohammad, Chief Strategist – Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.

“Besides, the large bear candle, registered on 27th of September, from the highs of 9,921 is also acting as a supply point thereby preventing the up move of the indices. Unless Nifty50 decisively conquers these multiple resistance points on closing basis bears will continue to have upper hand,” he added.

Mohammad further added that in the fourth coming sessions if the index closes below 9,850 then the selling pressure may accelerate further. Contrary to this, if Nifty50 closes above 9,945 levels then bulls can look for targets in the zone of 9,990 – 10,080.

India VIX marginally fell down by 0.76 percent at 11.71. Volatility has been cooling down from last five sessions and now a small rise in VIX could pause it bounce back rally.

On the options front, maximum Put OI was seen at strike prices 9800 followed by 9700 strikes while maximum Call OI is intact at 10,000 followed by 9,900 strikes.

Fresh Put writing was seen at strike prices 9900 and 9800 while fresh Call writing was seen at all the strikes from 9900 to 10,200 strikes.

“Option data suggest a small decline then a range bound move with limited upside. The Nifty index failed to surpass 9,950 zones and witnessed profit booking after the bounce back move of last four trading sessions,” Chandan Taparia, Derivatives and Technical Analyst at Motilal Oswal Securities told Moneycontrol.

“If Nifty negates the formation of higher highs – higher lows of last four sessions by holding below 9,880 then it may again start the decline towards 9,820 then 9,777 zones. On the upside, the index has hurdle near 9,950 and then towards 9,980 levels,” he said.

(1 to 1 out of 1) - Latest Replies on Top | First | << Previous | Next >> | Last |
Rakesh Padhi at 08:28 AM - Oct 08, 2017 ( )

how was the result of this bearing candle and the great chartist !!!!!!!!!!!!!!!!

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