Tech View: Nifty forms Shooting Star candle. What should traders do on Thursday

The short-term moving averages are just below the price action and should continue to support the indices on any decline. Support for Nifty is now seen at 22,500 and 22,300-350 levels. On the higher side, the immediate resistance zone is at 22,750-800 levels and the next psychological resistance for Nifty is at 23,000 Mark. Overall, Nifty is likely to remain volatile within the 22,300–22,800 range in the near term, said Tejas Shah of JM Financial & BlinkX.

Analysis of Nifty put options reveals a concentration of Open Interest (OI) at the 22,500 level, suggesting potential support, while significant OI concentrations on the call side are observed at 22,800 and 23,000 levels, approaching all-time highs. On the Bank Nifty call side, the highest open interest is observed at 50,000, acting as a resistance level, while on the put side, 49,000 is seen as a good support level.

The market will be shut on Wednesday to mark the occasion of Maharashtra Day.

What should traders do? Here’s what analysts said:

Rupak De, LKP Securities

Nifty witnessed selling pressure as it encountered resistance near the previous swing high, resulting in a weak closing. Other indicators such as the 20-day Simple Moving Average (SMA) and the 50-day SMA are positioned below the index value, suggesting that the ongoing positive trend remains intact. The Relative Strength Index (RSI) also indicates a bullish crossover. Over the next few days, the trend in the headline index might remain sideways unless it breaks above the all-time high of 22783. On the downside, immediate support is placed at 22500, below which the index might decline further.

Jatin Gedia, Sharekhan

Nifty witnessed a pullback during the last hour of trade which helped it to close off the intraday lows. During the day, it managed to close and hold above the 61.82% Fibonacci retracement level (22117) and now we expect a relief rally over the next few trading sessions. On the upside, we expect the gap areas formed in the previous couple of trading sessions to be filled up which is likely to take the nifty towards 22420 – 22500. On the downside, 22080 is the crucial support level to hold for the upmove to continue.

(Disclaimer: Recommendations, suggestions, views and opinions given by the experts are their own. These do not represent the views of The Economic Times)