New DELHI: Nifty50 defended its immediate support at 10,000 level throughout Friday's session. The index formed a bullish candle on the daily chart, as the bulls were not willing to give in following Thursday's fall.
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This was the second week of sharp gains for Nifty50, which has now reached its 20-week moving average on the weekly chart. Analysts said the index has the potential to move towards the 10,300 level, as there are no sign of weakness on technical charts.
"Lower time frame i.e. the hourly, chart shows the index is in process of forming a distribution near 10,000-10,200. On the downside, the swing low of 9,944 is a key support and a significant fall can be seen in the index once this low is breached. On the higher side, the 10,200-10,300 is a crucial hurdle zone to watch out for," said Gaurav Ratnaparkhi, Senior Technical Analyst at Sharekhan.
For the day, Nifty rose 113 points, or 1.13 per cent, to end at 10,142.
"The index is now approaching crucial moving averages and resistance clusters, which might act as resistance going ahead. There is no immediate crucial sign of weakness to rely on. The trend on a higher time frame chart is bearish and Nifty is trading just above the 20-week EMA, which may turn out to be a pullback rally," said Jimeet Modi, Founder & CEO, SAMCO Securities.
Modi sees strong hurdles in the 10,450-10,550 zone, which coincides with many pivotal levels such as 61.8 per cent of the Fibonacci retracement of the recent down move.
The near-term oscillators still continue to be in 'buy' mode, said Arun Kumar, Market Strategist at Reliance Securities.
"The index has to sustain above the 9,930 level to maintain an overall positive trend. Nifty could rise towards the 10,300-10,460 range in the near term,” he said.
