Sensex fell 379.46 points to close at 71,892.48, while the Nifty 50 ended 76.10 points, or 0.35%, lower at 21,665.80. Nifty 50 formed a reasonable negative candle on the daily chart with minor lower shadow. The smaller range movement of the last 3-4 sessions has been broken on the lower side.
Also Read: Indian stock market: 6 things that changed for market overnight - Gift Nifty, oil prices to US manufacturing PMI “Technically, this pattern is indicating a short term reversal pattern. Such minor weaknesses post range movements in the recent past has turned out to be a buy on dips opportunity. Positive chart pattern like higher tops and bottoms is intact on the daily chart and present consolidation or weakness is in line with the formation of new higher bottom of the sequence.
The bottom reversal needs to be confirmed at the lows," said Nagaraj Shetti, Senior Technical Research Analyst, HDFC Securities. He believes the short-term trend of Nifty 50 is on a weak note and a slide below the immediate support of 21,500 could open some more weakness for the near term. A sustainable move above 21,840 could bring bulls back into the action.
Here’s what to expect from Nifty 50 and Bank Nifty today: The highest OI on the call side is noted at the 21,800 level, followed by the 22,000 strike prices. On the put side, the highest OI is observed at the 21,500 strike price. This data provides insights into the levels where options traders have the greatest exposure, said Mandar Bhojane, Equity Research Analyst, Choice Broking.
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