The immediate support of the ascending trend line has been broken to the downside recently and the important opening gap on August 5 remains unfilled. This is a negative indication. A decisive move below 23,900 could trigger a short-term downside correction in the market. The immediate resistance lies at 24,250-24,300 levels, said Nagaraj Shetti of HDFC Securities.
The open interest (OI) data revealed that the highest OI on the buy side was observed at the strike prices of 24,200 and 24,400, while on the sell side, it was concentrated at the strike price of 24,000.
The market will be closed to the public on Thursday due to Independence Day celebrations.
What should traders do? Here’s what analysts had to say:
Rupak De, Senior Technical Analyst at LKP Securities
The overall trend is likely to remain weak as the index continues to trade below the initial resistance level of 24,250. Moreover, the index has remained below the middle Bollinger band, confirming a weak short-term trend. This weakness could push the index towards 23,900/23,700. On the upside, resistance is expected at 24,250/24,500.
Shrikant Chouhan, Head of Equity Research, Kotak Securities
We believe that the intraday market texture is non-directional, perhaps traders are waiting for a breakout on either side. For intraday traders, 24,215/79,300 would be the key level. Above it, we could expect a quick rally up to 24,250-24,300/79,500-79,750. On the other hand, below the 50-day simple moving average (SMA) or 24,050/78,900, the selling pressure intensified. Below it, the market could drop to 23,900/78,500. The downtrend could also continue, which could drag the index down to 23,840/78,300.
Tejas Shah, Technical Research, JM Financial and BlinkX
Nifty continues to trade in the range of 24,000-24,400 levels for the past few days and we need to wait and watch for a breakout or a 300-400 points drop in Nifty’s directional move. Support for Nifty is now seen at 23,950-24,000 and 23,600 levels. On the upside, the immediate resistance for Nifty is at 24,200 and the next crucial resistance zone is at 24,350-400 levels. Overall, bears should continue to have the upper hand.
Jatin Gedia, Sharekhan
On the daily charts, we can observe that Nifty has been consolidating around the range of 24,200 – 24,150, where the 40-day moving average is located. The structure remains weak and since the momentum indicators have also had a negative crossover, it also supports our bearish stance. In case of a spike towards the key moving averages of 24,250 – 24,300, then it should be used as a selling opportunity for the targets of 23,890 – 23,600. On the upside, 24,300 is the immediate hurdle from a short-term perspective.
(Disclaimer: The recommendations, suggestions, views and opinions of the experts are their own and do not represent the views of The Economic Times)
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