NIFTY Index Chart Analysis
Bullish, But Under Pressure
As suspected and suggested in the last technical note, the Nifty closed with modest losses in the month of January and history was repeated. But it formed a doji candle at a lifetime high on the monthly chart, signalling indecisiveness at the higher levels. The Nifty ended its two-week declining phase and closed above the prior week’s high. As mentioned earlier, the bears have failed to pull down the index for three consecutive weeks, which was needed for a decisive downtrend. Even on the daily timeframe, the index has not declined by more than three consecutive days.
For a downtrend, the index has to form a swing low below 21,137. Until then, the market status will be ‘uptrend under pressure’. In an expected move, the Nifty formed a new lifetime high last Friday. But soon after hitting the new high, it declined sharply by 288 points from the day’s high and formed a shooting star or an inverted hammer candle. In this sharp decline, it filled the January 17 gap area. Finally, it settled above the counter-trend consolidation’s resistance.
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