Tech View: Nifty forms Doji candle but crosses 200-DMA? What traders should do on Monday
Nifty Forms Doji Candle but Crosses 200-DMA: What Traders Should Do on Monday
In the latest trading session, the Nifty index showcased a significant move by crossing the 200-Day Moving Average (DMA) at 23,860, only to find itself unable to maintain that level. The formation of a Doji candle on the daily chart indicates indecision among traders, a classic signal that often precedes market volatility.
Understanding the Doji Candle
The Doji candle reflects a balance between buyers and sellers, suggesting that while the bulls attempted to push the index higher, the bears quickly countered their efforts. This tug-of-war leaves traders questioning the market’s next move.
Weekly Chart Insights
Looking at the weekly chart, we can observe an inside bar pattern, which typically indicates consolidation and a potential breakout. The strong demand zone between 23,500 and 23,540 suggests that buyers are still active, providing a cushion for the index.
What Should Traders Do Next?
For traders eyeing Monday’s session, the key levels to watch are 23,500 and 23,860. A sustained move above 23,860 could signal a bullish trend, while a drop below 23,500 may lead to further selling pressure. It’s essential to keep an eye on global cues and market sentiment as these will significantly influence trading decisions.
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In conclusion, while the Nifty’s current position presents both opportunities and risks, informed decisions can make all the difference. Happy trading!
