Tech View: Nifty forms long bearish candle. Here’s how to trade on Wednesday
Nifty slipped below short-term and medium-term averages. Now, 50-day SMA or 22,400/73,500 and 22,500/74,000 are likely to act as key resistance areas for traders. Nifty has violated the higher-top and higher-bottom formations and suggests change in short-term trend.
ended Tuesday’s session 6% lower at 21,884.50 to form a long candle on the daily chart and also ended below and medium-term averages.For traders now, 50-day SMA or 22,400/73,500 and 22,500/74,000 would be the key areas while 21,600-21,300/71,000-70,200 would act as key intraday zones. “We are of the view that the current texture is extremely and uncertain; hence, it is advisable that traders should remain cautious for next few sessions,” said Shrikant Chouhan, Head of Equity Research, .
What should traders do? Here’s what analysts said:
Jatin Gedia, Sharekhan
has decisively broken down below the previous swing low of 21,820, which has violated the higher-top and higher-bottom formations and suggests change in short-term . Our primary outlook is that Nifty shall now retrace the rise it has witnessed from 18,840 to 23,340 between October 2023 and May 2024. The crucial support levels to keep handy are 21,100, which is the 200-day moving average and 50% Fibonacci retracement level of the entire up move. A close below this support zone can lead to further decline towards 20,560, which is the 61.82% Fibonacci retracement level. On the upside, 22,310 – 22,550 shall act as an immediate hurdle from a short-term perspective. The range of consolidation is likely to be 21,000 – 22,500.Tejas Shah, JM Financial & BlinkX
Nifty closed below the crucial support zone of 22,400-500 (50-day EMA) in Tuesday’s trading session, which is not a healthy sign. Technically, the evidence continues to suggest that the markets are likely to remain under pressure in the near term. Presently, Nifty is finding support around the 200-day exponential moving average, which is currently placed at 21,250 levels. Support for Nifty is now seen at 21,750-800 and 21,250-300 levels. On the higher side, immediate resistance is at 22,300 levels and the next crucial resistance is at 22,500 mark.(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)
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Source: Stocks-Markets-Economic Times
