Hot Stocks: Consolidation likely but 11,900 likely to act as crucial support for Nifty

Nifty50 spot index has been struggling to clear the zone of 12,150–12,200, which was the potential reversal zone of a bearish harmonic AB=CD pattern.

The Nifty50 has undergone a corrective move in three out of four trading sessions so far this week. Even the market breadth remained in favour of declining counters, which indicates profit booking in individual stocks.

At this juncture, the index is trading the week with a loss of around 0.31 percent. On the other hand, the Nifty Bank index too suffered some selling and is trading with a loss of 0.73 percent from its previous week’s close.

Looking at the weekly chart of the NIFTY spot, it can be construed that the index is trading in the range of 11,900–12,150, which is similar to the previous week.

The short-term trend would be dented only on a breach of the 11,900 mark. Thus, for some more time, we feel that traders should adopt the mean reversion technique in the coming week.