4/4/2019 Technical View: Nifty forms 'Bearish Belt Hold' pattern; traders can go short - Moneycontrol.

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Technical View: Nifty forms 'Bearish Belt Hold' pattern; traders can go short
moneycontrol.com/news/business/markets/technical-view-nifty-forms-bearish-belt-hold-pattern-traders-can-go-short-3764081.html

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Last Updated : Apr 04, 2019 05:52 PM IST | Source: Moneycontrol.com

Mazhar Mohammad advised aggressive traders to go short on this market with a stop above 11,662 levels on closing
basis and look for a target of 11,311.

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4/4/2019 Technical View: Nifty forms 'Bearish Belt Hold' pattern; traders can go short - Moneycontrol.com

Sunil Shankar Matkar

The Nifty50 after rangebound trade drifted sharply lower in later part of session and closed below 11,600 levels after the Monetary Policy Committee cut repo
rate by another 25 bps while keeping neutral stance. The RBI lowered its inflation forecast for FY20 but reducing growth forecast dented market sentiment.

The index traded in broader range of 100 points between 11,560 and 11,660 and closed lower for second consecutive session, forming bearish candle which
resembles a 'Bearish Belt Hold' kind of formation.

A 'Bearish Belt Hold' pattern is formed when the opening price becomes the highest point of the trading day (intraday high) and the index declines throughout
the trading day making up for the large body. The candle will either have a small or no upper shadow and a small lower shadow.

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The index managed to hold above its crucial support of 11,550 zone, but if it breaks its crucial support on a closing basis then there selling pressure could be
extended, experts said.

The Nifty50 after opening higher at 11,660.20 hit an intraday high of 11,662.55 and low of 11,559.20 amid rangebound trade. It closed 46 points lower at
11,598.

"Nifty50 registered almost 'Bearish Belt Hold' kind of formation suggesting selling pressure from the word go," Mazhar Mohammad, Chief Strategist –
Technical Research & Trading Advisory, Chartviewindia.in told Moneycontrol.

He said as short-term supports breached with two bearish candles in succession bulls can remain under pressure unless Nifty50 recoils and register a close
above 11,662 levels which can give some hope of come back for bulls.

Near-term support appears to be around 11,523 levels breach of which on closing basis shall accelerate the selling pressure further, and in such a scenario
Nifty shall ideally extend its corrective swing towards 11,300 levels to complete short term corrective swing, he added.

Meanwhile he advised aggressive traders to go short on this market with a stop above 11,662 levels on closing basis and look for a target of 11,311.

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4/4/2019 Technical View: Nifty forms 'Bearish Belt Hold' pattern; traders can go short - Moneycontrol.com

Bank Nifty failed to hold above 30,250 zone and drifted sharply towards 29,800 levels. The index closed at 29,904.90, down 188.40 points and formed a
bearish candle on daily scale.

"It has been forming lower lows from last four trading sessions and closed near 29,888 zones. Now it has to surpass 30,250 zone else some more profit
booking could be seen towards 29,500-29,250 zones while hurdles are placed at 30,500 marks on closing basis," Chandan Taparia, Associate Vice President
| Analyst-Derivatives at Motilal Oswal Financial Services Limited told Moneycontrol.

India VIX fell by 0.69 percent to 18.65 levels.

On the Option front, maximum Put open interest (OI) is at 11,000 followed by 11,500 strike while maximum Call OI is at 12,000 followed by 11,800 strike.

Call writing is at 11,800 followed by 11,900 strike while Put writing is at 11,600 followed by 11,200 strike.

Option band signifies an immediate trading range in between 11,500 to 11,800 zones, experts said.

"Nifty index has seen a negative divergence with its RSI indicator as recently index made two swing highs at 11,572 and 11,761 while indicator noted the mark
of 80 and 75 which indicates some sort of pause in positive momentum at higher zones," Chandan Taparia told Moneycontrol.

He said the index has made new life time high of 11,761 but follow up is required above the same to extend the fresh leg of rally.

Now it has to hold above 11,550 zone to witness an up move towards 11,760 zone while on the downside support shifts at 11,480-11,450 zones.
First Published on Apr 4, 2019 05:07 pm

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