Tech View: Nifty forms long bull candle on record high day. What traders should do on Friday

The positive chart pattern like higher tops and bottoms is intact and the present up move is in line with the new higher top formation of the sequence. But, the higher top reversal has not been confirmed yet, chart readers said. Now, Nifty has to continue to hold above 18,888 zones to extend the move towards 19,200 and 19,250 zones while on the downside support exists at 18,888 and 18,777 zones, said Chandan Taparia of Motilal Oswal.

India VIX was up by 1% from 10.78 to 10.88 levels. Volatility is holding below 11 zones, which are supporting bulls. Option data suggests a broader trading range between 18,600 and 19,300 zones while an immediate trading range between 18,750 and 19,200 zones.

The Future Open Interest (OI) indicated buildup of fresh long positions in Nifty futures for the third consecutive day. The Foreign Portfolio Investors’ (FPIs’) Long-Short Ratio crossed the 60% mark for the first time since 30th May, 2023, indicating that the FPIs continue to hold more long positions relative to short positions.

The Put-Call Ratio (PCR), a sentiment indicator, jumped to 1.38 from 0.82 in the last three trading sessions, indicating strong put writers’ presence.

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

Nagaraj Shetti, Technical Research Analyst, HDFC Securities
The short-term trend of Nifty continues to be positive. Having surpassed above the crucial overhead resistance of 18900 levels on Wednesday, there is a possibility of more upside towards 19100-19200 levels in the next few sessions before shifting into consolidation/minor weakness from the highs. Immediate support is at 18830 levels.

Sameet Chavan, Head Research, Technical and Derivatives, Angel One
If the global market supports further, we may see Nifty entering the next cluster around 19250 – 19500. Before this, 19050 – 19150 are the immediate levels to watch out for. On the flipside, the base has now shifted higher towards 18700 – 18600, which should be considered as a sacrosanct support zone. On an immediate basis, 18850 – 18800 is likely to provide cushion in case of any intraday blip in the market. Traders are advised to stay upbeat and should focus on beaten down pockets now, which may offer better trading opportunities in the next few days.

Shrikant Chouhan, Head of Research (Retail), Kotak Securities
Nifty displayed a breakout formation and a bullish candle, indicating further upward momentum. Traders will closely watch the 18,900/63,700 level as a trend decider. Above this level, the index could rally towards 19,100-19,150/64,300-64,400. Caution is advised below 18,900/63,700, with traders considering exiting long positions.

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