Tech View: Nifty forms bearish candle, likely to consolidate with negative bias
Some consolidation or a minor weakness is likely in the next one-two sessions.
For the day, the index rose 23.05 points, or 0.21 per cent, to 10,840.65.
Nifty did not show any follow-through weakness after a sharp weakness of Tuesday, which should be a relief for the bulls, said Nagaraj Shetti of HDFC Securities.
"Some consolidation or a minor weakness is likely in the next 1-2 sessions, before the index sees another round of upside bounce from the lows. Immediate support to be watched is 10,750 level," Shetti said.
From the Elliot wave perspective, there is a slight confusion about the point of origin of the contracting Triangle. If the said Triangular structure is developing from August 5 low of 10,782, as a part of 4th Wave, inside Wave 3, it should have culminated at the recent high of 11,084, said Mazhar Mohammad of Chartviewindia.in.
“In that case, without a pullback, a much bigger correction is possible. Contrary to this, if the said triangle is in progress from the low of 10,637, it might have completed four legs and the fifth leg shall be in progress from the low of 10,796. In that case, a pullback towards 10,900-11,026 can’t be ruled out over the next couple of sessions,” Mohammad said.
The price formation suggests bearishness, but supports are intact, which are keeping the index in a broader trading range, said Chandan Taparia of Motilal Oswal Securities.
“The index needs to hold above 10,800 to witness any bounce towards 10,929 and 10,950. Supports are seen at 10,750 and 10,700,” Taparia said.
Till 10,650 is not breached, downside remain contra bullish, said Manav Chopra, CMT, Head Research of Equity at Indiabulls Ventures.