Synopsis
Indian benchmark index Nifty formed a bearish candle on the daily chart, indicating a short-term reversal pattern on the downside. It ended with an 85.6-point loss at just one point below its previous peak. The index should hold above 18,777 zones to witness upward movement towards 18,888 then 19,000 zones. Analysts predict immediate trading support at 18,710 and 18,666 zones. The broader trading range is expected between 18,550 and 19,000 zones. Technical analysts suggest support zones at 18,700-18,660 and a resistance zone at 18,880-18,900.
ANIIndicating a short-term reversal pattern on the downside, Nifty on Thursday formed a bearish candle or an outside bar candle on the daily chart as it fell just one point short of touching the previous peak and ended with a loss of 85.6 points.
Now it has to hold above 18,777 zones to witness an up move towards 18,888 then 19,000 zones while on the downside support exists at 18,710 and 18,666 zones, said Chandan Taparia of Motilal Oswal. Option data suggests a shift in broader trading range between 18,550 and 19,000 zones while an immediate trading range between 18,650 and 18,900 zones.
The Relative Strength Index (RSI) displayed a bearish crossover, indicating a weakening bullish momentum.
What should traders do? Here’s what analysts said:
Rupak De, Senior Technical at LKP Securities
The current trend seems to be sideways to negative as long as the index remains below 18,900. On the downside, a support level is identified at 18,700. If the index decisively falls below this level, it may trigger a significant correction in prices.
Jatin Gedia, Technical Research Analyst, Sharekhan by BNP Paribas
On the daily charts, we can observe that the Nifty has been facing stiff resistance at the zone of 18,870 – 18,900. Despite multiple attempts, it has been unable to surpass it. The hourly momentum indicator has a negative crossover, which is a sell signal and could be the reason for weakness in Nifty. On the downside, Nifty is trading around the key hourly moving averages 18,808 – 18,783, which can act as a support. The Bollinger bands are contracting, indicating that there could be more consolidation before it resumes trending moves. Overall, we continue to maintain our positive outlook on the index for targets of 19,000. In terms of levels, 18,700 – 18,660 shall act as a crucial support zone while 18,880 – 18,900 shall act as a crucial resistance zone.
Nagaraj Shetti, Technical Research Analyst, HDFC Securities
The immediate supports of daily 10 and 20 EMA are intact around 18,745 and 18,640 levels, respectively. Unless these crucial supports are broken decisively on the downside, the deep cut in the market can’t be expected. On the upper side, the area of 18,900 is likely to be a strong hurdle for the short term.
Shrikant Chouhan, Head of Research (Retail), Kotak Securities
For day traders, 18,850 would be the immediate resistance level. Below which, the market could retest the level of 18,700-18,650. On the flip side, a fresh uptrend rally is possible only after the dismissal of 18,850. Post the breakout, the Nifty is likely to rally till 18,900-18,935.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
(What’s moving Sensex and Nifty Track latest market news, stock tips and expert advice on ETMarkets. Also, ETMarkets.com is now on Telegram. For fastest news alerts on financial markets, investment strategies and stocks alerts, subscribe to our Telegram feeds.)
Download The Economic Times News App to get Daily Market Updates & Live Business News.
Top Trending Stocks: SBI Share Price, Axis Bank Share Price, HDFC Bank Share Price, Infosys Share Price, Wipro Share Price, NTPC Share Price
…moreless
