Nifty: Trade Setup: Market looks indecisive; 17,800 level now key for Nifty

It was a day of constructive consolidation for the home fairness market. Nifty opened increased, acquired stronger through the day, got here off its highs however maintained its opening positive aspects to shut within the constructive zone. Following a beneficial world commerce setup, Nifty traded in a slim vary till afternoon. The afternoon session noticed the market get stronger and Nifty went nicely previous the 17,844 stage. The 50-pack then got here off the excessive level of the day, however managed to shut close to the opening stage with a acquire of 144.35 factors (+0.82 per cent).

The expiry of weekly choices influenced the session. The 17,800 strike worth continued to witness excessive Name writing, and this made the market unable to maintain above this level and in addition prevented Nifty from settling above the 17,800 stage. From a technical perspective, the 17,800 stage stays an necessary resistance throughout the broad 17,450-17,950 consolidation zone that the market has created. Additionally, Wednesday’s excessive level of 17,884 stays an necessary stage to observe. If any recent thrust on the upside has to come back, it could be essential for Nifty to maneuver previous the 17,800 stage and maintain above that time.

Volatility continued to fall. India VIX got here off by 6.79 per cent to 16.1550. Friday’s session might even see a quiet begin. The 17,835 and 17,900 ranges will act as seemingly resistance factors for Nifty whereas help might are available in at 17,740 and 17,680 ranges.

The Relative Power Index (RSI) on the day by day chart stood at 63; it remained impartial and didn’t present any divergence towards the value. The day by day MACD remained bearish and stayed under the Sign Line. A Spinning High emerged on the candles. This can be a kind of candle with a small actual physique and is fashioned due to a little or no distinction between the opening and shutting ranges of the session. From the market’s psychology viewpoint, this displays the the indecisive behaviour of the market members.

Whereas the market stays in a broad consolidation zone, it has tried to create a small congestion vary for itself. This makes the 17,600 and 17,890 ranges essential to observe, as any slip under the 17,600 stage will take Nifty to the decrease fringe of the consolidation vary, i.e., 17,400-17,450. However, if the market has to hit its excessive level once more, it will likely be critically necessary for Nifty to maneuver previous Wednesday’s excessive level of 17,884.

We advocate persevering with to navigate the market with a stock-specific method. Earnings needs to be protected on the both facet, whereas retaining total exposures on the modest stage.


(Milan Vaishnav, CMT, MSTA, is a Consulting Technical Analyst and founding father of EquityResearch.asia and ChartWizard.ae and is predicated at Vadodara. He may be reached at milan.vaishnav@equityresearch.asia)