The Nifty 50 staged a sharp reversal after a day of heavy selling, rising 1.3 percent on October 9 and forming a Bullish Harami candlestick pattern on the daily chart. While the pattern suggests a potential trend reversal, follow-through buying next week will be crucial to confirm the recovery. However, the broader technical structure remains bearish, with the index trading below all key moving averages—the 10-, 20-, 50-, 100- and 200-day exponential moving averages (EMAs)—on both daily and weekly charts, all of which are sloping downward.
The index also snapped an eight-week losing streak, ending the week 0.44 percent higher and offering some relief to bulls. On the weekly chart, it formed a Doji candlestick pattern, indicating indecision between buyers and sellers. Although a Doji following a downtrend can signal a potential reversal, confirmation from subsequent price action is needed before a bullish trend can be established.
On the upside, the Nifty 50 faces immediate resistance at 22,800, near the current week's high. A sustained move above this level could pave the way towards 23,000, which coincides with the 20-day EMA and the midline of the Bollinger Bands. As long as the index remains below the 23,000 zone, consolidation and range-bound trading may continue. On the downside, support lies in the 22,300–22,200 zone. A break below this range could trigger renewed selling pressure, according to market experts.
The Nifty 50 opened higher on Friday and remained in positive territory throughout the session. Extending its gains as the day progressed, the index touched an intraday high of 22,581 before closing at 22,520, up 289 points, or 1.30 percent.
The Relative Strength Index (RSI) has formed a base in the oversold zone and is now approaching 40, suggesting that selling pressure may be easing and a short-term pullback could be in the offing. The Moving Average Convergence Divergence (MACD) remained below its signal line, although the histogram indicated a moderation in bearish momentum. Together, these indicators point to the possibility of a near-term recovery, but do not yet confirm a sustained reversal.