On the upside, immediate resistance appears at 23,300, followed by a crucial hurdle near 23,500. A sustained close above these resistance levels will be necessary to negate the prevailing bearish sentiment and confirm a bullish reversal. Hardik Matalia, of Choice Broking, said that considering the increasing volatility in the market, traders are advised to remain cautious and implement strict stop-loss measures to protect their capital.
In the open interest (OI) data, the highest OI was observed on the call side at 23,200 and 23,100 strike prices, while on the put side, the highest OI was at 23,000 strike prices followed by 22,800.
What should traders do? Here’s what analysts said:
Jatin Gedia and Mirae Asset SharekhanNifty opened a gap up, but could not sustain at higher levels and closed in the red zone with a decline of 320 points. On the daily charts, we can notice that the Nifty has been consolidating in the range of 23,100 – 23,500 since the last six trading sessions which was broken decisively to the downside. A breakdown signals the resumption of the next phase of decline. On the downside, we expect the pair to drift towards 22670 which is the 38.2% Fibonacci retracement level of the rise from the March 2023 low of 16828 to the high of 26277 in September 2024. On the upside, 23280 – 23320 is the immediate hurdle area from a short-term perspective. .
Vatsal Bova, LKB Securities
On Tuesday, Nifty opened on a positive note but faced selling pressure near the 14-day moving average, and closed with a long bearish candle above the key support level of 23,000 and below the consolidation range. The RSI, currently at 36 and in a bearish crossover, is indicating a downtrend, indicating there is room for further downside before entering oversold territory and strengthening bearish dominance. Selling pressure continues to limit the recovery, and a follow-up move will be key to confirming further declines. A close below 23,000 could push the index towards pre-election levels of 22,500, with immediate resistance at 23,300. Till the Nifty closes above 23,500, a sell-on-the-rise strategy is recommended.
Hrishikesh Ydvi, Asit C. Mehta Intermediary Investments
Technically, the Nifty index has formed a modest green candle on the daily chart, indicating strength. Immediate resistance for the index is located around 23,400, while support is located near 23,050. If the index continues above 23,400, the relief rally may extend to 23,550 levels. On the upside, the 250-day simple moving average (DSMA) barrier has been placed around 23,570 levels, which will act as a crucial hurdle.
Nagaraj Shetty, HDFC Securities
A long bearish candlestick has formed on the daily chart which has engulfed the narrow range action over the past six sessions to the downside. The broader high and low range between 23400-23050 is now on the verge of a bearish breakout. The previous opening bearish gap on January 13 affected the market leading to sharp weakness. The underlying trend has fallen sharply after a small upward bounce. The next lower support to watch is around 22800 levels and any pullback rally may find strong resistance around 23200 levels.(Disclaimer: The recommendations, suggestions, views and opinions given by experts are their own. They do not represent the views of The Economic Times)
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