NIFTY Index Chart Analysis

Markets Remain Structurally Weak

After a decline of 1,348 points in the last 12 trading sessions, Nifty showed a significant single-day recovery last Friday. It recovered most of the weekly losses and formed a long lower shadow candle on the weekly chart. But the strong recovery failed to test the gap area of September 26. The most important technical development is that the Nifty reclaimed its 200 DMA after spending two days below it in the last five trading sessions. This long-term average acted as support and resistance for two days and finally on the final day of the trading session it reclaimed it. Though it moved above the 200 DMA, the index is still below the short-term and medium-term averages.