Tech View: Nifty charts hint at upside bounce in the offing. What traders should do on Wednesday

On the call side, the highest OI was observed at 18800, followed by a 18900 strike price, while on the put side, the highest OI was at 18500, followed by a 18400 strike price.

Chart readers say 18700 would be the key level to watch out for as an upside above the same could lead to a fresh uptrend rally till 18800-18850. Resistance is seen at 18600-18500 zone.

What should traders do? Here’s what analysts said:

Manish Shah, Independent Technical Analyst

Nifty remains in a strong uptrend. It needs to move above 18730 for us to see a rally towards 18900-19000. A break above 19000 and we should see more upsides towards 19200-19300.

Avoid short-selling Nifty. For the end-of-week expiry traders, a break above 18730 will signal a rally. Avoid remaining on the short side of the market for a prolonged period. Equity markets the world over are on a rising trajectory.

Nagaraj Shetti, Technical Research Analyst, Securities

Nifty remains in a consolidation movement with gradual weakness. The market is expected to witness upside bounce from near the support of 18550 levels in the next 1-2 sessions.

Rupak De, Senior Technical Analyst at

Investors mostly remained on the sidelines as they preferred waiting for the RBI monetary policy announcement. The Nifty found support around the previous low before closing a bit higher. The trend may remain sideways as long as the index remains within the bands of 18600-18800. Any decisive move on either side will induce a directional move.

Ajit Mishra, VP – Research,

Broking

Markets are digesting the recent gains, and it may take a few more sessions to resume the trend. Meanwhile, traders should focus on managing positions and gradually adding quality names across sectors. The decline in the auto and IT majors is offering a good opportunity to accumulate, while pharma is not showing any sign of a reversal yet.

Gaurav Ratnaparkhi, Head of Technical Research, Sharekhan by

The Nifty moved down yet again to test the key support at 18600. The bulls managed to defend that support for the second consecutive session. Channel study shows that the index has reached near the lower end of the rising channel on the hourly as well as daily chart. Thus, this is a high probability level for the index to start the next leg on the upside. Initial resistance zone is at 18700-18730.

Overall, the Nifty is expected to surpass the recent high of 18888 and target 19000 in the short term. The reversal for this bullish stance has been placed below 18500 on a closing basis.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of Economic Times)