NEW DELHI: The Nifty50 on Monday witnessed selling pressure from the word go and ended up a tad below the psychologically important 10,800 level.
The index formed a Small Bearish Belt Hold candle and an Inside Bar on the daily chart, as it traded inside the trading range of last session.Analysts feel the index may remain rangebound for some time, before seeing a decisive breakout.
For the day, the index shed 17.85 points, or 0.17 per cent, to close at 10,799.The index got stuck in a range and requires a decisive range breakout to start the next leg of rally.
As long as it holds above 10,750, Nifty50 could see an upward move towards 10,850 and 10,888 levels.
Support for the index exists at 10,720 level, said Chandan Taparia of Motilal Oswal Securities.
After showing a recovery from the days low in the last two sessions, the index settled near its days low on Monday.
The pattern signals ongoing sideways range movement in the market, said Nagaraj Shetti of HDFC Securities.The underlying trend remains choppy.
The ongoing range-bound movement is likely to continue with a negative bias, Shetti said.Daily indicators RSI and Stochastic are in the negative territory.
Some profit booking cannot be ruled out, said Rajesh Palviya of Axis Securities.Nifty continues to consolidate within the 10,830-10,750 range for past three consecutive sessions, indicating a short-term sideways movement.
Breakout on either side of the range will signal further direction, the expert said.Traders are advised to focus on trend-deciding levels in the short term, which shall lead to a directional move.
On the downside, the 10,755 level looks critical, a breach of which may enhance selling pressure and strengthening the hands of the bears, whereas a close above 10,893 will give the bulls a lift, said Mazhar Mohammad of Chartviewindia.in.