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The market maintained a positive momentum for the third consecutive session amid firm Asian indexes and technology stock purchases on Wednesday. The Nifty50 closed higher, but failed to keep its 200 DMA rate due to higher earnings, as traders became cautious before the expiry of futures and options options. November Thursday.
The index formed a "shooting star". type of pattern on the daily charts. The pattern is formed when the index is under pressure to sell when traders start to earn profits at higher levels.
This pattern usually forms in an uptrend and is treated as a reversal scheme, but confirmation is needed before we can conclude that the trend will be reversed in the near future.
Profits at higher levels and muted sales in major sectors indicated that the internal market situation remained very low, experts said, adding that one could avoid creating new ones.
Nifty50 open and closed above 10,700 levels. The index reached an intra-day high of 10,757.80 and a low of 10,699.85, before closing at 43,722 points, or 10,728.90 points higher.
"Despite a bullish spread, buyers appeared to lack conviction.Nifty50 pulled slightly down the intraday range after testing A 200-day moving average (10,741) describing a kind of candle-shaped "Shooting star," Chartcontrol Mazhar Mohammad, chief strategist – Technical Research & Trading Advisory, said in a statement released by Moneyview.
The information technology sector (+ 2.89%) and the media sector (+ 2.15%) is clearly misleading, as the internal market situation remains very poor, with almost all other sector indices down , with the exception of the Nifty Financial Services Index, which managed to keep its head out of the water with a marginal gain of 0.43%, he said.
Therefore, at the next session, if Nifty50 closes at less than 10,695 levels, there is a good chance that the market will trigger a selloff, according to him.
Contrary to this strength, it should recover to a level close to 10,775, he said. As a result, he advised traders not to create new positions until a sustainable breakout reaches a level above 10,774.
With respect to options, l & # 39; maximum open interest (OI) is 10,500, followed by 10,600 strokes, while the maximum Call OI was observed at 10,800 followed by 11,000.
Significant The handwriting was seen at 10,700, followed of 10,650, while Call was seen at 10,800, followed by 10,850. The option band signifies a trading range between 10,650 and 10,800 zones.
India VIX fell 1.66% to 18.01. Experts said: "The Nifty index has closed positively, but has formed a shooting star candle on a daily scale, which indicates that rises to higher levels to overtake. the recent record of 10,774 zones, "said Chandan Taparia, badociate vice president | Motilal Oswal Financial Services, derivatives badyst, told Moneycontrol.
He explained that the index was moving between 10,489 to 10,774 zones since the last ten trading days and required a decisive break above 10,774 for the next move to take place.
It must now hold above 10,650 zones to witness an increase to 10,774 and then to higher levels while, on the downside, a multiple support exists between 10,580 and 10,550 zones, a-t -he adds. but failed to hold his winnings and closed flat with a small full-bodied candle on a daily scale. It has reached a new high for eleven weeks, but momentum and follow-up are lacking in the highest areas. It closed up 14.85 points to 26,457.95.
"Now the index must continue to hold above 26,250 areas to reach a niche range of 26,650 to 26,750, while significant support is visible in 26,000 areas, "said Chandan Taparia.
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