Nifty Stages Sharp Intraday Recovery

After showing weakness from the highs on Wednesday, Nifty shifted into a roller-coaster ride of sharp up and down trended moves on Thursday and closed the day higher with sharp recovery note. After opening on a downside gap of 300 points, the market slipped into further weakness and formed a new swing low at 22182 levels in the early part of the session. Massive recovery has emerged from the day’s low and Nifty finally closed higher amidst volatility towards the end. The opening downside gap has been filled completely.

A long green candle was formed on the daily chart after opening lower. Technically, this market action indicates a formation of bullish counter attack type candle pattern at the lows. The bearish chart pattern like lower tops and bottoms continued on the daily chart and Thursday’s low of 22182 could now be considered as a new lower bottom of the pattern.

The buying seems to have started from near the support of 22200 levels and Nifty needs to sustain above the hurdle of 23000 levels to consider this as a bottom reversal pattern. Immediate support is placed at 22400 levels.