Tech View: Rise above 19850 might spark rally towards 20K. What traders should do on Wednesday
Nifty on Tuesday ended 89 points stronger to form a small positive candle with upper shadow on the daily chart.
The short-term trend of Nifty continues to be range-bound. The present consolidation pattern could eventually result in a decisive upside breakout of the hurdle at 19900 levels from here or from slightly lower levels.
The anticipated upside breakout could pull Nifty towards the new all-time highs. Immediate support is at 19,650 levels, said Nagaraj Shetti of HDFC Securities.
Open Interest (OI) data shows that on the call side the highest OI was at 19,900, followed by 20,000 strike prices. On the put side, the highest OI was observed at the 19,700 strike price.
What should traders do? Here’s what analysts said:
Jatin Gedia, Sharekhan
On the daily charts we can observe that since the last four trading sessions, Nifty is trading in the range of 19875 – 19627.
On the downside, the Nifty is trading above the zone of 19650 – 19600 where multiple support parameters in the form of the 40-hour moving average and the lower end of the rising channel are placed. Thus, in case of a dip this zone should act as a support, and we expect the Nifty to hold on to this zone and head higher over the next few trading sessions.
The hourly momentum indicator has a positive crossover.
However, the Nifty is not breaching the range and once it does that, we can expect it to gain momentum. Until then, the range-bound price action is likely to continue. In terms of levels, 19610–19650 is the crucial support zone while 19900–19930 is the immediate resistance zone.
Rupak De, LKP Securities
Nifty concluded with a gain after a positive trading session, maintaining a consistently positive sentiment as it consistently closed above the
