Tech View: Nifty forms hammer candle on daily scale. What traders should do on Tuesday
Donald Trump waging a tariff war on Canada, Mexico and China sent a chill into global markets as major European and Asian indices, including India's headline indices, reeled under selling pressure on Monday. Banks, energy and FMCG stocks fell most even as the IT sector tried to salvage some pride. Meanwhile, Saturday’s Budget announcements or rather the lack of them for capex-intensive sectors soured the D-Street sentiments. While the 30-stock S&P BSE Sensex finished at 77,186.74, declining by 319.22 points or 0.41%, the broader Nifty fell by 31.75 points or 0.52% to close at 23,361.05.
Commenting on the day's action, Dr. Praveen Dwarakanath, Vice President of Hedged.in, highlighted that Nifty exhibited strength taking support from the middle of the Bollinger band after a sudden fall during the day.
“The momentum indicators on the hourly chart, after a drop of below 50 levels, show a rise, also indicating positive sentiments in the index. The index formed a candle with a bullish closing, indicating the momentum to continue towards the next resistance at 23,800 levels. Options writer's data for the weekly expiry showed increased writing of puts at the 23,300 and below levels and increased writing of calls at the 23,500 and above levels, indicating a range bound index," Dwarakanath.
What should traders do? Here’s what analysts said:
Jatin Gedia, Mirae Asset Sharekhan
Nifty opened the gap down and thereafter consolidated during the day to close down 121 points. On the daily charts, we can observe that the Nifty is
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