This pattern reflects a tug-of-war between buyers and sellers, but the bullish close suggests that buyers had a slight advantage by the close. The Nifty index was flat in a narrow range at the beginning of trading, but ended at 24,275.35 as buyers increased the index.
The 24,000 level is expected to act as an important support zone. A decisive break below this level could push the index into the 23,800-23,600 range.
On the upside, 24,500 remains a key resistance level, and a sustained break above this mark could pave the way for further upside. Hardik Mataria, derivatives analyst at Choice Broking, said that in the current volatile environment, traders are advised to follow a buy-the-touch strategy as long as the index remains above 24,000.
In the open interest (OI) data, the highest OI on the call side was observed at strike prices of 24,300 and 24,400, while on the put side, the highest OI was at strike price of 24,200, followed by 24,100.
What should traders do? Analysts say:
Jatin Gedia, Sharekhan The daily chart shows that the Nifty has consolidated broadly within the 24,100-24,350 range since the last three trading sessions. We expect this consolidation to continue as the hourly momentum indicators still show a negative crossover and are still far from the equilibrium line. On the downside, 24,160 to 24,140 is a strong support zone. As for the upside, 24,350 to 24,400 is the immediate hurdle.
Rupak De, LKP Securities
Nifty has been holding its value for the past three days following the recent rally. On the upside, it is facing resistance at 24,420. A definitive breakout above this level could trigger a big move to higher levels. On the downside, support is located at 24,100. The index is likely to remain range-bound until it moves in either direction.
Nagraj Seethi, HDFC Securities
A short-term bottom reversal has been confirmed, and the Nifty trend is significantly rising. With the price sitting near the overhead resistance level at the 24,500 level, we could see some consolidation or a slight decline over the next session or two before a rally to the upside. The next upside target (above 24,500) to watch is around 25,000 in the next 1-2 weeks. Immediate support is 23,900.
Tejas Shah, BlinkX, JM Financial
Currently, Nifty is facing a major recovery near the 24,350 level for the last few days. For further strength in Nifty, we need to see a definitive close above the 24,350 level. Otherwise, consolidation is likely to continue in the 24,000 to 24,350 level range. Support for Nifty is currently seen between 24,150-200 and 23,950-24,000. On the upside, Nifty’s immediate resistance is at 24,350 levels and the next important resistance zone is at 24,500-550 levels.
(Disclaimer: Recommendations, suggestions, views and opinions by experts are their own. They do not represent the views of Economic Times)
