Nifty 50: Aggressive traders may short-sell index with stop loss at 19,525

It is crucial to set a strict stop loss at 19,525 to manage risk since resistance levels are projected at 19,380 and 19,490

Nifty 50 Index

The Nifty 50 Index is presently trading at 19,331.80. On hourly charts, the index has been consolidating within the range of 19,350 to 19,525. However, the recent closing below the lower range indicates a breakdown and suggests the onset of a bearish phase in the near future. It is important to acknowledge that the overall trend of the index remains bullish.

As a strategy, it is advisable to purchase on declines near the support levels of 19,200, 19,025, and 18,800 as these levels serve as price cushions during downward movements. For traders with a higher risk tolerance, short selling at the current market price or on rallies could be considered. However, it is crucial to set a strict stop loss at 19,525 to manage risk since resistance levels are projected to be encountered at 19,380 and 19,490, which could impede further upward movement.

Nifty Bank Index

The Nifty Bank Index is currently trading at a CMP (Current Market Price) of 44,925. The overall trend of the index is bullish, and the current pullback in price is seen as a positive development within the bullish chart pattern. Support levels on the charts are expected around 44,625, 44,300, and 44,075. It is recommended to buyi on dips near these support levels.

For traders who are willing to take on higher levels of risk, a sell-on-rise strategy could be considered. This strategy anticipates that the index may underperform in the near-term. However, it is important to note that a close above 45,675 should be treated as a strict stop loss for all short-selling positions. Resistance levels are projected at 45,250 and 45,450. These levels may act as barriers to further upward movement. Traders should closely monitor these levels when implementing their trading strategies.


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Disclaimer: Ravi Nathani is an independent technical analyst. Views expressed are personal. He doesn't hold any positions in the indices mentioned above and this is not an offer or solicitation for the purchase or sale of any security.