Tech View: Nifty50 bulls get some relief but no signs of reversal yet

For the day, the index closed at 17,503.35, up 86.80 points or 0.5 per cent. During the day, the index smartly recoiled from the lower end of the 23-day old descending channel, with an intraday low of 17,216 level, said Mazhar Mohammad at Chartviewindia.in.

“A temporary bottom may be in place at 17,216 level but a sharp spike should not be expected as Nifty50 is still trading below its critical moving averages. Therefore, sustaining above the 17,216 level, the ideal scenario shall be a rangebound movement in the 17,250-17,700 range. A close above 17,805 can act as a confirmation of strength,” Mohammad said.

Nifty50 is at a major crossroads in terms of context and location of the current trend, said Independent Analyst Manish Shah.

“The weekly 20-period moving average is at 17,200 and Nifty50 hit this weekly average, before bouncing off. It is too early to call for a reversal of the decline from 18,600-17,200. The debacle was sharp and it will take some serious change in the Nifty50 resistance at 17,680-17,710. It could be in for some selling at this level. Support is at 17,200-17,230. Trade with caution in the coming few days,” he said.

Chandan Taparia of Motilal Oswal Securities said that the index is forming lower highs-lows for the last five sessions. He said the index needs to hold above the 17,500 level for an upmove towards 17,650 and 17,777 levels. Downside support is intact at 17,350 and 17,200 levels, he said.