stock market analysis: Tech View: Nifty50 forms small bearish candle; resistance seen at 17,720-225 levels

Friday’s small bearish candle was placed within a long bear candle of the previous session. Technically, this action indicates range movement in the market with high volatility, said Nagaraj Shetti, Technical Research Analyst at

Securities.

“The index is trading near the 17,725 resistance level, an important retracement level. It has also formed a lower top formation on intraday chart, which supports further correction from the current levels,” said Amol Athawale, Deputy Vice President – Technical Research, Kotak Securities.

“For the bulls, 17,725 would be the immediate resistance level. On the flip side, 17,500 would be the crucial support zone. Below the same, the index could retest the level of 17,350 and down the index could retreat to 17,200 level,” he added.

The index seems to have lost its upward momentum with a near-term top present around the 17,992 level, said Mazhar Mohammad of Chartviewindia.in, who expects the index to remain directionless, confining to the 17,726-17,482 range.

For the day, the index closed at 17,558.90, up 36.45 points or 0.21 per cent.

“While some strength can be expected on a close above 17,720, weakness should be confirmed on a close below its 20-day SMA (17,418), which the bulls have managed to defend in the current fall from the highs of 17,992. In that scenario, a bigger correction with initial targets of 16,950 looks inevitable. Traders are advised to remain neutral on the long side but intraday traders can consider shorting below 17,480 for a modest target of 17,410 level,” Mohammad said.

Nifty Bank

Kunal Shah, Senior Technical Analyst at

, said that Nifty Bank continued to face stiff selling pressure around the 39,500 level. The index is stuck in a broad range between 38,500-39,500 levels, and a break on either side will give trending moves, he said.

“Traders should trade with strict risk management as September has been the series where the index has seen more than five per cent move,” Shah said.

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