Tech View: Nifty charts hint at further rebound. What traders should do on Tuesday

As Nifty ended comfortably above the 19,500-mark, a small positive candle with a long lower shadow was formed on the daily charts. Having formed such a pattern after one session of rise, one may expect less impact on the negative side for the market for the short term, said Nagaraj Shetti of HDFC Securities.

Nifty is currently in an attempt of showing an upside breakout of the down sloping trend line around 19500 levels. A decisive move above 19600 levels is expected to pull Nifty towards the next upside of around 19800-19900 levels in the near term. Immediate support is at 19430 levels, Shetti said.

The daily momentum indicator has a positive crossover, which is a buy signal.

What should traders do? Here’s what analysts said:

Rupak De, LKP Securities
Nifty continues to stay in the bullish territory as the index has maintained its position above the channel breakout level. The trend is expected to stay positive as long as it remains above 19,525. On the upside, the index could potentially extend its gains towards 19,750. Conversely, if it falls below 19,400, we may witness a period of consolidation.

Jatin Gedia, Sharekhan
On the daily charts, we can observe that the Nifty is stretching on the upside. The intraday dip was bought into, which indicates buying interest at supports and also suggests bullishness. We believe that the Nifty is in the process of retracing the fall it has witnessed from 19992 – 19223 and hence the pullback is likely to last over the next few trading sessions. On the upside, we expect the Nifty to target levels of 19650. In terms of levels, Crucial support zone is placed at 19420 – 19360 and immediate hurdle is placed at 19650 – 19700.Ajit Mishra, SVP – Technical Research, Religare Broking
Indications are favorable for further rebound as Nifty has surpassed a trend line resistance while holding the support zone of short-term average i.e. 20 EMA. However, a hurdle of around 19,650 may cap the upside and prompt some profit taking too. Amid all, we reiterate our view to focus on stock selection and preferring auto, IT and metal for long trades.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)

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