Nifty Analysis: Tech View: Nifty50 forms Gravestone Doji. What does it say about tomorrow’s session?

NEW DELHI: Nifty50 on Thursday got off to a gap-start, but could not add much to the gains, as selling emerged at higher levels. The index ended up forming a Gravestone Doji candle on the daily chart. This came in the wake of a long bullish candle formed in the previous session. Analysts, however, said the positive trend remains intact.

Independent analyst Manish Shah said if one blends the candles of last two days, what we see is a long candle that runs parallel to Monday’s debacle.

“This is a railroad track. Nifty has closed above the high of Monday’s candle, and above the 50 per cent retracement of the decline from 15,430 to 14,635, which is a trend continuation signal. Nifty50 will continue to trade above the recent high at 15,432 and we should see the momentum pick up,” Shah said.

For the day, the index closed at 15,097, up 115 points or 0.77 per cent.

Mazhar Mohammad of Chartviewindia.in said some intraday weakness on the index can be expected if it slips below 15,065 level.

“The positive stance can be retained as long as Nifty sustains above the 15,000 level. If the bulls manage to push the index higher beyond 15,173 level, the gains will expand initially to 15,271 level and later to the lifetime high around 15,430. For the time being, traders, who are long, are advised to hold their positions,” he said.

Check out the candlestick formations in the latest trading sessions

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Chandan Taparia of Motilal Oswal Securities said a small-bodied candle with a long upper shadow on Thursday suggested the need for followup buying.

“Nifty has continued to form higher highs and lows for last two sessions. Now, it has to hold above 15,000 level to extend its move towards 15,250 and 15,400 levels. The immediate support exists at 14,900 and 14,850 levels,” Taparia said.