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The Nifty experienced another session of volatility, ultimately closing marginally higher around the level of 22,198. Despite a flat start, the index oscillated within a range throughout the day. The mixed trend across sectors saw realty, IT, and auto sectors gaining ground, while financials and energy sectors faced pressure. The broader market performance remained muted, with both ending nearly flat.
Technical Analysis:
The recent price action suggests that bulls are consolidating their positions at record-high levels, awaiting fresh triggers. Buoyancy in the global market, particularly in the US, is encouraging, but alignment in heavyweight sectors, especially banking majors, is awaited for fresh momentum.
The Nifty has been consolidating within a broad range of 21,900 to 22,300 over the past few trading sessions. Bollinger bands contraction indicates range-bound price action. The index held onto the support zone of 22,100 – 22,070, where the 40-hour average was situated. An hourly momentum indicator has triggered a positive crossover, signaling a buy, thus intraday dips are likely to be bought into.
Support and Resistance Levels:
Support: 21,900
Resistance: 22,300
Bank Nifty Overview:
The Bank Nifty underwent correction from its recent peak, finding support at the 21-day Exponential Moving Average (21EMA) on the daily timeframe. The index has been trading in a range between 46,300 to 47,400. In today’s session, it held onto the 40-day average (46,300) and bounced back.
Technical Analysis:
The battle between bulls and bears may persist for a few more days or until a decisive breakout from the range of 46,500-47,000 on a closing basis. A significant decline below 46,500 could lead the index towards 45,500 in the short term. Conversely, a sustained trade above 47,000 might propel the index towards 47,700.
Support and Resistance Levels:
Support: 46,300
Resistance: 47,000
Conclusion:
Both Nifty and Bank Nifty experienced volatility but managed to end the day with marginal gains. Nifty remains range-bound with support at 21,900 and resistance at 22,300, while Bank Nifty shows signs of positive momentum with support at 46,300 and resistance at 47,000. Traders are advised to adopt a "buy on dips" approach with a focus on stock selection amid ongoing consolidation in the markets.
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