Tech View: Nifty indicators give positive signals, likely to face resistance at 24,694. How to trade tomorrow

The Nifty gained 128 points on Tuesday to close at 24,467. It started on a weak note, but bounced back sharply from around the support zone of 24,150-200 and remained above the same throughout the trading session. The first half was very volatile after a negative start and, simultaneously, fresh buying emerged during the second half of the trading session when bulls took complete control of the markets.

Nifty formed a bullish candle in Tuesday’s session after forming a Triple Bottom pattern in the 24,073-24,140 band and closed at its highest in last five sessions. Its indicators are giving positive signals. The short-term trend of Nifty seems to have turned bullish. It could take support from the above band while on the upmove, it can face resistance in the 24,567-24,694 band in the near term, said Deepak Jasani of HDFC Securities.

In the open interest (OI) data, the highest OI on the call side was observed at 24,500 and 24,600 strike prices, while on the put side, the highest OI was at 24,400 strike price followed by 24,300.

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

Jatin Gedia, Sharekhan

On the daily charts, we can observe that the Nifty has found buying interest from the support zone of 78.6% Fibonacci retracement level of 24,170 and started the next leg of upmove. The upmove is likely to continue towards 24,563 – 24,823, which are the Fibonacci extension targets. The hourly momentum indicator has triggered a positive crossover and there is a high probability that the countertrend pullback rally, which started, can continue over the next few trading sessions.

Hrishikesh Yedve, Asit C Mehta Investment Interrmediates

Nifty opened flat and, after an initial dip, saw a strong recovery, closing positively at 24,467. The volatility index, INDIA VIX, rose by 1.57% to 14.52, indicating increased market volatility. Technically, Nifty formed a bullish candle following an Inside Bar pattern, signalling buying interest. If the index sustains above 24,493, it may extend gains to the 24,600–24,700 range, with strong support at 24,070. As long as it holds above this level, a ‘buy on dips’.

Tejas Shah, JM Financial & BlinkX

As long as Nifty is holding above 24 K, the present pullback rally, which started recently, is likely to continue. However, it is facing a lot of resilience around 24,450 to 24,500 levels for the past couple of days on an immediate basis and we need to witness a decisive close above 24,450-500 levels for further strength in Nifty. Support for Nifty is now seen at 24,200 and 24,000. On the higher side, the immediate resistance zone for Nifty is at 24,450-500 levels and the next crucial resistance zone is at 24,700-750 levels.

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