Published On: Wed, Dec 4th, 2019

Nifty outlook: Tech View: Piercing Line on Nifty chart shows buying at lower levels

NEW DELHI: Nifty50 formed a ‘Piercing Line’ pattern on the daily chart on Wednesday, suggesting the emergence of buying from the lows.

Often, such a formation results in a follow-through buying, said Nagaraj Shetti of HDFC Securities. “The index held on to its immediate support at 12,000 after an intraday violation. This is a positive indication. One may expect some more up-move in the next session,” he said.

For the day, the index closed 43.10 points, or 0.36 per cent, higher at 12,037.

During the day, it took support around the lower end of the channel and the 20-EMA on the daily chart for the second consecutive session, said Chandan Taparia of Motilal Oswal Securities.

“The index needs to stay above 12,000 to witness an up-move towards the 12,158 level. On the flipside, strong support is placed in the 11,935-11,950 range,” Taparia said.

Gaurav Ratnaparkhi of Sharekhan, however, feels the market is still not out of the woods. “The minor degree correction that started from the recent high of 12,158 seems to be getting subdivided into lower degree waves. This means further fall towards the junction of 40-DEMA and the daily lower Bollinger Band, i.e. 11,820-11,800, cannot be ruled out before Nifty resumes a larger up-trend. ‘Sell on rise’ should be the preferred strategy with the immediate hurdle in the 12,050-12,070 zone,” he said.

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