Nifty needs a decisive break above 11000 points

The markets rallied sharply on Friday after taking a breather in the previous session as the indices clocked their best gains of the week, but ended lower for the week. The gains came on the back of positive Asian markets amid easing US-China trade tensions. The Sensex gained 337 points or 0.92 per cent, while Nifty Index ended 98.3 points or 0.91 per cent higher at 10,946.2.

The broad market indices like the BSE Mid Cap and Small Cap indices gained less, thereby underperforming the Sensex/Nifty. The market breadth was positive on the BSE/NSE.

According to technical analysts, on hourly charts the index has closed inside bullish cloud which implies if the index holds 10900 it can inch toward 11050 levels.

"Technically, with the Nifty rallying sharply and taking out its recent highs, the bulls do seem to have an upper hand for the short term at least. Further upsides are likely in the coming week once the immediate resistance of 11043 is taken out. Crucial supports to watch for resumption of weakness are at 10816," Deepak Jasani, Head Retail Research, HDFC Securities said.

Technical View
"Nifty forms a Hammer pattern indicating a reversal is on the way. Amid its prolonged consolidation within a range of 10800 - 11000 for a third consecutive week, a hammer pattern signifies or gives a caution for an upcoming reversal, especially, when formed on a weekly scale," Mustafa Nadeem, CEO, Epic Research said.

Market View
"Markets rejoiced possibility of de-escalation of the trade war between the US and China. However, sustainability would be difficult in absence of any domestic support. On the benchmark front, Nifty has reached closer to its immediate hurdle of 11000 and requires a decisive break above the same for further up move. In case of decline, 10850-10750 zone would continue to provide the support. We suggest keeping a close eye on upcoming local data and global markets for triggers," said Ajit Mishra Vice President, Research, Religare Broking.