Tech view: Nifty forms a Long White Day; looks set for rally

NEW DELHI: The Nifty50 surged nearly 2 per cent on Monday to settle above its 100-day exponential moving average (EMA). In the process, the index formed a ‘Long White Day’ candle on the daily chart.

 This formation on the daily chart indicates that the bulls maintained buying pressure throughout the session. The middle and low price points of such a candle can prove a strong support for the index. “ Monday’s upmove was broadbased.

While it will be too early to conclude that a fresh leg of uptrend has started from the recent low of 10,141, its possibility can’t be ruled out if the index gets past the 10,631 level in the next two sessions,” said Mazhar Mohammad of Chartviewindia.in.

For the day, Nifty50 surged 194.55 points, or 1.90 per cent, to 10,421. It managed to hold above the 10,276-10,300 range and reclaimed near its previous week’s high levels, said Chandan Taparia of Motilal Oswal Securities. “The index has started forming higher highs and higher lows. The RSI indicator also turned from its deep oversold territory and, thus, short coverings are also visible in the market. The index has to continue to hold above 10,333 to extend its move towards the 10,500-10,525 zone. On the downside, support exists at the 10,300 level,” Taparia said.