The immediate support of the ascending trend line has been broken on the downside recently and the significant opening downside gap of 5th August remains unfilled. This is a negative indication. A decisive move below 23,900 could trigger near-term downward correction in the market. Immediate resistance is placed at 24,250-24,300 levels, said Nagaraj Shetti of HDFC Securities.
Open Interest (OI) data revealed that the highest OI on the call side was observed at 24,200 and 24,400 strike prices, while on the put side, it was concentrated at 24,000 strike price.
The market would remain shut for trading on Thursday on account of Independence Day celebrations.
What should traders do? Here’s what analysts said:
Rupak De, Senior Technical Analyst, LKP Securities
The overall trend is likely to remain weak, as the index continues to trade below the initial resistance level of 24,250. Additionally, the index has been sustaining below the middle Bollinger Band, confirming a weak near-term trend. This weakness might push the index towards 23,900/23,700. On the higher end, resistance is expected at 24,250/24,500.
Shrikant Chouhan, Head equity Research, Kotak Securities
We are of the view that the intraday market texture is non-directional perhaps traders are waiting for either side breakout. For day traders, 24,215/79,300 would be the key level. Above the same, we could expect one quick pullback rally up to 24,250-24,300/79,500-79,750. On the flip side, below the 50-day SMA (Simple Moving Average) or 24,050/78,900 the selling pressure intensified. Below which, the market could slip till 23,900/78,500. Further down side may also continue which could drag the index till 23,840/78,300.
Tejas Shah, Technical Research, JM Financial & BlinkX
Nifty is still trading in the range of 24,000 to 24,400 levels for the past few days and we need to wait and watch for either side breakout or breakdown for 300 to 400 points of directional move in Nifty. Support for Nifty is now seen at 23,950-24,000 and 23,600 levels. On the higher side, immediate resistance for Nifty is at 24,200 and the next crucial resistance zone is at 24,350-400 levels. Overall, the 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 24,200 – 24,150 range where the 40-day average is placed. The structure is still weak and with the momentum indicators also having a negative crossover is also supporting our bearish stance. Incase of a spike towards the key moving averages 24,250 – 24,300 then it should be used as a selling opportunity for targets of 23,890 – 23,600. On the upside, 24300 is the immediate hurdle from a short term perspective.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)