Nifty Gives Decisive Breakout to Confirm ‘Falling Channel’ Pattern
Stock Market & BSE Bull ! (Image credit BSE India)
Nifty Faces Next Hurdle at 89EMA at 23300-400
By S Jha
New Delhi, March 20: Sharp short covering sent the stock market soaring on Thursday. Nifty gained almost 300 points to touch the level of 23200. Technically, the 50-share index is now eyeing higher levels in the coming days.
The overnight commentary of the US Federal Reserve set the stock market on bullish path on Thursday. Nifty opened with gap up to scale the 23k level and easily crossed the resistance.
Nifty gained 1.24% on the day of the expiry of the weekly option contracts. “From a technical perspective, the correction that began in September from 26277 saw every bounce getting sold into along a descending trendline. However, this session’s decisive breakout above this trendline confirms a ‘Falling Channel’ pattern,” said Angel Broking in an advisory note to clients.
The brokerage also stated that the “RSI smoothened has crossed above 50 and is on the verge of breaking its previous swing high”. It added that the chart is “signaling a shift in momentum toward the bulls”.
But the brokerage firm warned that “the low-hanging fruits have already gone, and after such a sharp move, some consolidation or a slower pace is likely”. “As far as levels are concerned, we have been eyeing the 89EMA around 23300-23400 since the start of the week, making it an immediate hurdle,” added Angel Broking in its post-market commentary.
It also stated that the “immediate support is seen at 23000, aligning with the 50-DEMA, while strong support lies at 22800”. “The index surged past 23,200 for the first time since February 13, 2025, with RSI at 63, the highest since September 2024, indicating strong bullish momentum,” added the brokerage firm.
It also stated that the “market breadth remained positive, with 46 stocks advancing and only four declining. In the Nifty 50 universe, over 90 per cent of stocks traded above their 10-EMA, 80.4 per cent above the 20-EMA, and 59 per cent above the 50-EMA”.
It asserted that the stock market is “signaling strong short-term trends”. “All sectors ended in the green, led by oil & gas, consumption, infra, auto, FMCG, and IT,” it added.
The short covering in Nifty also came on the back of the India VIX (volatility index) falling over 5%, marking its lowest closing level since October 3, 2024, indicating reduced market volatility.
(Disclaimer: This article makes no recommendation for any kind of trades in the stock market)
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