At the current juncture, the bears are in full control of the markets and are using every pullback rally to create short positions. Support for Nifty is now seen at 24,950-25,000 and 24,750. On the higher side, immediate resistance is at 25,100 levels and the next resistance zone is at 25,250-275 levels, Tejas Shah of JM Financial & BlinkX.
In the open interest (OI) data, the highest OI on the call side was observed at 25,000 and 25,050 strike prices, while on the put side, the highest OI was at 25,000 strike price followed by 24,950.
What should traders do? Here’s what analysts said:
Rupak De, LKP SecuritiesThe index remained largely sideways throughout the day as the 25,000 level was mostly held. On the daily chart, the index has been failing to reclaim 50EMA for the last two days, indicating prevailing weakness. On the lower end, support is placed at 24,950–24,900. A fall below 24,900 could trigger a correction toward 24,750–24,700. On the other hand, resistance is seen at 25,150, and a move above this level could push the index towards 25,350–25,400 in the short term
Jatin Gedia, Sharekhan
On the daily charts, we can observe that the Nifty is in the process of retracing the 1500 fall. We believe that the retracement is not complete and there is more steam left for the upside towards 25350 – 25500. Thus, this current consolidation phase should be used as a buying opportunity. Crucial support zone is placed at 24900 – 24850 and should be kept as a stoploss for the long positions.
Hrishikesh Yedve, Asit C Mehta Investment Interrmediates
Technically, on the daily chart, the index formed a small red candle, indicating selling pressure at higher levels. However, the index is still holding above the low of the insider bar candle. Thus, as long as the index holds above the low of 24,690, levels of 25,150–25,350 could be possible. However, a close below 24,690 could lead to a fresh breakdown.
Praveen Dwarakanath, Hedged.in
Nifty formed an insider candle, indicating indecisiveness. The rally during the day was sold-off, indicating weakness to continue in the index. ADX DI- line continues to trend downside, still not showing signs of a further fall, however, momentum indicators are hinting towards a fall in the index. Options writer’s data showed a short covering of 25300 puts while an increase in call writing at 25000 and above levels, indicating a sideways to downside bias 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)