Tech View: Nifty may break below 18,300 in near term. What traders should do on Friday
Nifty on Thursday ended 57 points lower to form a significant bearish engulfing candle pattern on the daily chart, indicating potential weaknesses ahead. Thursday’s move signals chances of Nifty sliding down to or breaking below the immediate support of 19300-19250 levels in the near term.
Any attempt of an upside bounce could find strong resistance around 19550 levels, said Nagaraj Shetti of HDFC Securities.
The daily and hourly momentum indicator has a negative crossover and thus the pullbacks are likely to be sold into.
What should traders do? Here’s what analysts said:
Rupak De, Senior Technical analyst at LKP Securities
Nifty remained under bear grip as selling pressure emerged around the day's high, resulting in a decline below 19,500. On the upper side, resistance is expected to persist in the range of 19450-19500.
A definitive breakout or a closing above 19500 could potentially trigger a rally in the index. On the lower side, there is immediate support at 19300, a drop below this level might lead to panic in the market.
Jatin Gedia, Sharekhan
On the daily charts, we can observe that the pullback rally has fizzled out around the resistance zone of 19500 – 19550 where multiple resistance in the form of the 20-day moving average and the 38.2% Fibonacci retracement level (19538) of the fall from 19992 – 19253 was placed.
Overall, we shall continue to maintain our negative outlook on the index for targets of 19100. Crucial support is placed at 19280 – 19250 while immediate hurdle is placed at 19500 – 19530.
Shrikant Chouhan, Head of Research (Retail), Kotak Securities
For bulls, 19470 would act as an immediate resistance zone, and if the index is trading below the same, the weak sentiment is likely to continue and could
