Tech View: Nifty charts reflect indecisiveness. What traders should do on Thursday expiry

After witnessing range-bound price action throughout the day, Nifty on Wednesday formed a small green candle with a minor upper and lower shadow. The high-wave type candle reflects volatility at higher levels.

Currently, the market is placed at the hurdle of 18,800 levels and is showing lack of strength to witness any decisive upside breakout of the same.

Chart readers said Nifty is slowly inching higher towards the previous swing high of 18,778, which once taken out shall lead to further upside. The hourly and daily momentum indicators are providing divergent signals, which are likely to align once we get a decisive move on either side.

What should traders do? Here’s what analysts said:

Jatin Gedia, Technical Research Analyst, Sharekhan by BNP Paribas

Overall, the uptrend is intact, and we expect it to reach levels of 18,800 in the short term. In terms of levels, 18,630 – 18,6200 shall act as a crucial support zone while 18,778 – 18,800 shall act as an immediate hurdle zone.

Nagaraj Shetti, Technical Research Analyst, HDFC Securities

The positive chart pattern of higher highs and lows is intact as per the daily time frame chart. Further, an up move above 18,778 levels with lack of strength could possibly result in another higher-top formation for the short term and that could bring the next round of short term weakness for the market. However, a decisive move above 18,800-18,900 levels could open further upside into all-time highs. Immediate support is placed at 18,625.

Rupak De, Senior Technical at LKP Securities

The trend remains positive as the index closed above the critical near-term moving average. The momentum oscillator RSI is in a bullish crossover. Resistance on the higher end, is placed at 18,800-18,900. On the lower end, support is seen at 18,700/18,600.

Shrikant Chouhan, Head of Research (Retail), Kotak Securities

Nifty took support near 18,700 and bounced back sharply but failed to surpass the important level of 18,775. The short-term formation of the market is still in the bullish side but below 18,700, we could see a quick intraday correction. For traders, 18,775 would be the immediate breakout level to watch out and above the same, the index could rally till 17,900-17,950. On the other side, below 18,700, the selling pressure is likely to accelerate and below the same the index could retest the level of 18,600-18,575.

Rahul Ghose, Founder & CEO – Hedged

Nifty Bank continues to see open call writing positions for tomorrow’s expiry as well as the June monthly expiry. Even if there is a short covering rally in this index, the 44,500 and 45,000 calls for the June monthly expiry still have significant call writing present. Nifty, on the other hand, is looking extremely bullish for the June month expiry. One can look to initiate bull call spreads for next week’s expiry to play this upside, which will also ensure that the risk is curtailed in case of a sideways movement in the index.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)

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