'Nifty needs to close above 11,585 to negate short-term bearish trend'

Close above 11,585 would negate the bearish setup on the short term charts and could push Nifty towards the recent high of 11,794

Above 11,585, bearish setup on Nifty chart would be negated

Nifty index closed at the highest level in the last 5 sessions. The index has retraced 61.8% of the entire down move seen from 11,794 to 11,185. Any level above 11,585 will also surpass the previous top resistance on the daily chart. Close above 11,585 would negate the bearish setup on the short term charts and in that case Nifty could move towards the recent high of 11,794. The way sectors are getting rotated. It seems that the chances of Nifty going up are higher than going down. Support for Nifty is seen at 11,383 and with that stop loss Nifty should be held long.

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The stock price has broken out from last 5 month’s consolidation. Volumes remained high during the price breakout. For last 3 sessions, the stock has been consolidating with lower volumes. However, considering the primary up trend, it is expected to perform well in the coming days too. The price is placed above all important moving averages, indicating uptrend on all time frames

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The stock price has broken out from last one month’s price consolidation. Primary trend of the stock has been bullish, as it has been forming higher tops and higher bottoms on the weekly and monthly charts. There is a bullish "Flag" pattern breakout is seen on the weekly chart of the stock. The rise in price is accompanied by rise in volumes too which adds the strength in the current up move.

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Disclaimer: Vinay Rajani is Technical Research Analyst at HDFC Securities. The analyst doesn't have any holding in the stock. Views are personal.