Index trend and stocks in action on June 11, 2020

Nifty opened the session with a gap-up, however, post the gap-up opening, there was not much follow-up buying and the index started to trim its gains. Thereafter, the index traded in a capped range but in the last leg of the trade, index saw a sharp surge and it ended the day above 10,100 levels.

The price action formed a bull candle with a lower shadow. Further, as the price traded within high-low range of prior bar, it led to a formation of an inside bar. As there is a formation of inside bar, Tuesday’s high and low is likely to be important levels to watch out.  A move above or below the low of Tuesday’s session could give a sharp move.

On the upside, the 100-DMA which is placed at 10,255 is likely to act as a resistance. While on the downside, the 8-DMA is acting as a support for the index.  On the hourly time scale, the index resisted at the 20-DMA and this 20-DMA has turned down.

Overall, Tuesday’s high-low is a crucial level to watch out and a move above Tuesday’s high would further provide strength to bulls and they may aim to test the levels of 10,300.

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