Mr. Nagaraj Shetti, Technical Research Analyst, HDFC Securities
The range bound action continued in the market on Thursday and Nifty closed the day lower by 18 points amidst high volatility. After opening with a negative note, the market displayed high volatility of up and downswings for the day. The upside recovery attempt of mid part has failed to sustain and Nifty closed near the lows.
A small body candle was formed on the daily chart with upper and lower shadow. Technically, this market action signal a formation of doji pattern. Normally a formation of doji after a down trend and uptrend signal impending trend reversal. But, the present doji formation within a range movement suggest less predictive value.
The smaller degree of higher tops and bottoms is intact and and present weakness could be in line with the formation of higher bottom. But, still there is no confirmation of any higher bottom formation at the lows.
After the formation of false upside breakout at 15800 levels on 27th June, the absence of any sharp weakness from near the hurdle in the last three sessions could be in favor of bulls to make a comeback from the lows. But, any decisive move below 15600 levels is likely to negate the bullish bet and could result in sharp weakness down to 15200 levels.