Headline equity index Nifty today formed a long negative candle on the daily chart, indicating ongoing downward correction in the market. The index has been making lower highs on the daily scale the last three trading sessions.
“Now, it has to cross and hold above 18,200-18,250 zones, for an up move towards 18,350 then 18,444 zones whereas supports are placed at 18,088 and 17,950 zones,” said Chandan
of .
Option data suggests a broader trading range in between 18,000 to 18,600 zones while an immediate trading range in between 18,000 to 18,400 zones.
What should traders do? Here’s what analysts said:
Manish Shah, Trader and Coach
We still think Nifty is showing a corrective decline. The underlying trend in the market remains bullish. The moving average still shows an ongoing uptrend. A counter trend at times offers good opportunities to go on the long side.
Nifty needs to trade above 18,250 to signal a revival in sentiment. Overall, we expect the market to gain momentum on the upside once a break above 18,250 is seen. It is too premature to call out a top in Nifty. We wait for a signal to put us again on the long side of the market.
Ajit Mishra, VP – Research, Broking
Participants should see the dip as normal profit taking after the recent surge and we expect the 17,950-18,050 zone to act as immediate support in Nifty. While we’re seeing a mixed trend across sectors, resilience in the banking space is playing a critical role in capping the damage so far. We recommend continuing with a stock-specific trading approach and maintaining positions on both sides.
Rupak De, Senior Technical Analyst at
The bearish crossover in RSI with a negative divergence suggests weak momentum. Going forward, 18,100 may provide immediate support below which the index may drift down towards 17,750. On the higher end, resistance is visible at 18,200/18,450.
Nagaraj Shetti, Technical Research Analyst, Securities
The market is now sliding down to the next important cluster support of around 18,100-18,000 levels (previous opening upside gap of 11th Nov, 20-day EMA and previous tops as per change in polarity). This is going to be crucial support for the market, and one may expect an upside bounce from the lower levels.
The short-term trend of Nifty seems to have turned down and the market is now approaching a crucial support zone of around 18,100-18,000 levels, which is expected to be a make or break for the market ahead. Failure to show any sustainable upside bounce from near the said support is likely to open sharp weakness for the market ahead.
(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)
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