The domestic stock market ended on a weak note on Friday as stocks remained in a corrective mood. The NSE Nifty settled with a loss of 52.70 points or 0.45 per cent at 11,788.85.
The index has ended at the vital pattern support that exists in the 11,780-11,820 zone. Developments on the trade war front are likely to infuse some positivity into the early trade.
A flat to mildly positive opening is expected on Monday, but the level of 20-DMA, which stands at 11,843, will remain a critical resistance point.
Mondays session is likely to see 11,840 and 11,875 levels act as the next resistance points. Supports may come in at 11,710 and 11,660.
The Relative Strength Index (RSI) on the daily chart stood at 50.7025 and it continued to remain neutral, showing no divergence against the price. The daily MACD stayed bearish and traded above its signal line. No important patterns were observed on the candles.
The pattern analysis of the daily charts showed that Nifty continued to remain within the congestion zone. The index faces resistance near the short term 20-DMA on the upside, while the lower band near the 50-DMA is expected to act as a support.
No sustainable upmove is expected unless the index moves past and closes above its short term 20-DMA. On the other hand, weakness shall creep in only if Nifty slides below 50-DMA.
Unless either of the moves develops on the chart, the market will not take any directional bias and continue to consolidate in a broad range with a negative bias.
We recommend traders to avoid aggressive bets on either side until a directional bias is established. The develoRead More – Source
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