NEW DELHI: The Nifty50 settled above the 11,000 mark on Tuesday and formed a small bullish candle on the daily chart.
During the session, the 50-pack strikingly traded in the same trading range as Mondays, but the only difference was that the Tuesday intraday high fell short of Monday's high by a small margin.
Nifty supports shifted higher and the trade setup remains in favour of the bulls, but the index needs further strength to get past multiple hurdles and make its way towards the 11,080 level.
On the hourly chart, the index broke out from a falling channel on the upside. “As per the wave theory, Nifty is forming wave extension on the upside on the daily chart. This means the bulls are likely to push the index north. On the higher side, the 11,100-11,171 range shall be a crucial area to watch out for,” said Gaurav Ratnaparkhi of Sharekhan.
Chart patterns suggest if the Nifty50 manages to cross the 11,050 level, it can see an extended rally towards the 11,120-11,160 range in the near term. “The 10,980-10,930 range will continue to act as key support in case of any minor corrective,” said Rajesh Palviya of Axis Securities.
For the day, the index rose 71.20 points, or 0.65 per cent, to 11,008. It appears the last three sessions of the corrective consolidation phase is a mere pause of the ongoing strong uptrend as the advance-decline ratio tilted in favour of the bulls during the course of the day, said Mazhar Mohammad of Chartviewindia.in.
The underlying short-term trend is positive, said Nagaraj Shetti of HDFC Securities, who noted that the index rebounded from its key support in the 10,880-850 range during the session. The next overhead resistance to watch over the next 1-2 sessions will be at 11,080, he said.
Chandan Taparia of Motilal Oswal Securities said the Nifty50 has managed to hold above the immediate support in the 10,925-10,929 range and recovered towards the previous days high of 11,020 during the session.
"The index retested the previous breakout zone and now a hold above 11,000 could extend its move towards 11,080. On the downside, support is seen at 10,929 level,” he said.
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