The underlying trend of Nifty remains weak within range movement. Having failed to sustain the recent upside bounce, the market could revisit the lower range of 24,600-24,500 levels in the near term. Immediate resistance is at 25,000 levels, said Nagaraj Shetti of HDFC Securities.
In the open interest (OI) data, the highest OI on the call side was observed at 24,900 and 24,800 strike prices, while on the put side, the highest OI was at 24,700 strike price followed by 24,500.
What should traders do? Here’s what analysts said:
Jatin Gedia, Sharekhan
Nifty witnessed selling pressure from the 25,000 mark, which coincides with the high concentration of open interest on the call side implying resistance. On the downside, the 20-week average (24,730) which was defended well last week is being tested again. So there is a standoff between bulls and bears leading to heightened volatility. Overall, we expect a rangebound price action in the range 24,500 – 25,200 from short- term perspective.
Hrishikesh Yedve, Asit C Mehta Investment Interrmediates
On the daily chart, the Nifty formed a bearish candle, which indicates weakness. However, the index managed to hold the neckline support of the Head and Shoulder pattern and close above the 24,700 level. On the upside, the 21-Days Exponential Moving Average (21-DEMA) around 25,120 will be the major hurdle for the index, followed by 25,240. If the index sustains below 24,700, then further weakness could be possible.
Tejas Shah, JM Financial & BlinkX
Technically, the market seems to be very critically placed at this point. The broader markets underperformed as compared to the mainline indices. India VIX witnessed a minor rally to the levels of 13.88 (Up by 6.42%). Presently, the Nifty is trading around a make-or-break support zone of 24,700-750 levels and any decisive close below the same for a couple of days can trigger a 1% to 2% fall in Nifty on an immediate basis or else a reversal from here could take the Nifty back to the psychological resistance levels of 25,000. Support for Nifty is now seen at 24,700-750 and 24,500. On the higher side, immediate psychological resistance for Nifty is at 25,000 mark and the next crucial resistance zone is at 25,250-300 levels.
Rupak De, LKP Securities
Nifty remained volatile throughout the day as traders were uncertain about the market direction. On the higher end, it found resistance at the 50EMA on the daily timeframe. Additionally, the index failed to move beyond 25,000, which led to selling pressure that pushed it down to 24,700. If Nifty falls below 24,700, the selling pressure may intensify. However, if it holds above 24,700, a smart recovery toward 25,050 could be expected.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)