NEW DELHI: Nifty on Wednesday fell below the 14,700 level, and in the process breached a few crucial supports, including the 50-day moving average.
The index ended up forming a Bearish Belt Hold pattern, which suggested bear domination over the bulls. Analysts said the next support for the index lies in the 14,620-14,600 range. They continue to see resistance for the index in the 15,000-15,050 zone.
Wednesday saw the expiry weekly option contracts, as the stock bourses would be shut on Thursday on account of Id-Ul-Fitr (Ramzan Id).
Aditya Agarwala of YES Securities said the 20-DMA for the index now lies at 14,620 level. It will be critical to watch out for support in the 14,650-14,600 zone and see whether the bulls are able to push the index back above 14,800 level.
“A failure to hold the 14,600 level will extend the correction to the 14,500-14,360 zone. If the bulls manage to push Nifty50 above 14,800 level, it will resume the upward journey,” he said, adding that the RSI is also locked in the 40-60 zone, which suggests range-bound consolidation.
ETMarkets.com“Support for Nifty50 now stands at 14,620 level and below that in the 14480-14450 zone. On the upside, Nifty has resistance at 15,050 level. Should the index decline to the 14,450-14,480 zone, it would be seen as an opportunity to buy. How the market behaves on Friday will depend on how the US markets behave over the next two days,” said Mahish Shah, independent analyst.
For the day, Nifty closed at 14,696, down 154.25 points or 1.04 per cent.
Choice Broking said Nifty tested its rising trendline and sustained above it, suggesting that it can bounce back. It noted that the index has taken support at the 100-hourly moving average. Momentum indicator MACD has shown a positive crossover, which signals strength.
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ETMarkets.com“At present, Nifty has support at 14,600 level, while resistance on the upside is seen at 14,900,” the brokerage said.
“With the recent bounce, Nifty50 had reached a crucial hurdle in the 15,000-15,050 zone. From there on, the index has gone into the consolidation mode, from where it took a dip towards the key daily moving averages. Nifty50 has tested a rising trendline drawn from the April low of 14,151. The index has, thus, come near its crucial short-term support. It is expected to take a leap once again. Last week’s low of 14,416 will now be a major support in the short term. As long as Nifty trades above this level, the short to medium term outlook will remain positive,” said Gaurav Ratnaparkhi of Sharekhan.
