Positive chart patterns like higher tops and bottoms were intact on the daily chart and present weakness could be in line with new higher bottom formation at the highs, analysts said. On a move below 19,300, the market is likely to find another important support of 19,100-19,000 levels. Fresh buying interest could only emerge on a decisive move above 19500 levels, said Nagaraj Shetti of HDFC Securities.
What should traders do? Here’s what analysts said:
Osho Krishan, Sr. Analyst, Technical & Derivative Research, Angel One
As far as levels are concerned, a decisive closure beyond the sturdy hurdle of 19,500-19,520 could only trigger fresh longs in the system. Whereas on the downside, 19,300 is likely to provide a cushion from a short-term blip, while the sacrosanct support lies around the bullish gap of 19,200-19,235 in the comparable period.
Rupak De, Senior Technical analyst at LKP Securities
Despite a bearish signal, the overall trend remains positive as long as the price stays above the support level at 19,300. It is a level (19,300) where Put writers have maintained heavy positions, meaning that if the price drops below this level, it could indicate further downward movement. Below 19300 Nifty may fall down towards 19,000-18,900. On the upside, there is resistance at 19500, suggesting that the price may struggle to move beyond this level. A decisive move above 19500 might lead the writers to unwind their positions.
Jatin Gedia, Technical Research Analyst, Sharekhan by BNP Paribas
The hourly momentum indicator has triggered a negative crossover and is whipsawing on account of the sideways consolidation in the Nifty. Until we get a decisive close beyond the extremes of the range (19300 – 19550) we can expect the consolidation to continue. The strategy to trade such a consolidation would be to take a contrarian view around the extremes of the range. In this case, we are approaching the lower boundary 19300 and hence we should look out for a sign of strength around the support and go long. Overall, the trend is positive, and Nifty is undergoing time-wise correction. The crucial support zone stands at 19300 – 19280 while the resistance zone is placed at 19460 – 19485.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)