Nifty in for bearish bias

Nifty continues its bearish move after a pause as bearish factors weigh in on sentiments. A pause was seen with immediate support at 17,080 – 1,7020 but a continuation of a bearish bias was seen as the Nifty failed to move higher.

The gap remains with the formation of an island reversal indicating the complete exhaustion of bulls at higher levels. A loss breadth is seen with most stocks struggling to sustain their momentum, in terms of RSI, and failing to sustain higher levels.

Nifty has support at 16,850 – 16,890 levels but a Gap Down open and weaker global cues can further push Index towards lower levels of 16,450 – 16,400 in the short term while Niftybank can test lower levels of 35,600 – 35,650 in short term. Short-term MA continues to indicate a bearish bias while price action suggests higher volatility. We expect sideways to bearish price action in the coming days.

(The author is Technical Analyst at Finversify)