Nifty Commodities show bearish trend, suggest 'sell-on-rise': Ravi Nathani

The technical analyst recommends traders to employ a "sell on the rise" strategy when trading Nifty Commodities, given that its short-term pattern appears to be trading within a range of 5,600-5,400

Nifty Commodities
Last close: 5,483.55

Charts suggest that the index is likely to encounter significant obstacles in the near future, specifically in the 5,550-5,600 range.

Accordingly, we advise traders to employ a "sell on the rise" strategy when trading this index, given that its short-term pattern appears to be trading within a range of 5,600-5,400, and a close above or below this range could trigger a directional shift.

Furthermore, selling on rise is recommended due to bearish trend the index has exhibited on daily charts, as evidenced by its lower low and lower high trends, which will continue until it breaches the 5,650 threshold on a closing basis.

No Trade Zone: 5,505 - 5,465

Intraday Resistance Levels: 5,515 - 5,549 - 5,615

Intraday Support Levels: 5,436 - 5,390 – 5,310

Nifty Midcap 50 
Last close: 8,373.50

It would be prudent for traders to adopt a "buy on dips" approach in their trading strategy, as recent trends suggest a resurgence in the index from a state of oversold conditions.

Furthermore, it has been observed that the index is expected to outperform, with a target range of 8,564-8,660, owing to upward trajectory of Bollinger bands and inclination of the MACD trend towards positive territory.

In light of this analysis, it is recommended traders implement a "buy on dips" strategy for the Nifty Midcap 50 Index, coupled with a strict stop loss mechanism of 8,225 on a closing basis.

This, therefore, will ensure traders could maximise their potential returns, while also mitigating risks associated with market fluctuations.

In essence, the current market trends and technical indicators suggest a favorable outlook for the Nifty Midcap 50 Index. As such, traders are advised to proceed with caution and implement a well-informed trading strategy that takes into account the various risks and opportunities presented by the market.

No Trade Zone: 8,415 – 8,336

Intraday Resistance Levels: 8,436 – 8,481 – 8,600

Intraday Support Levels: 8,281 – 8,190 – 8,105

(Ravi Nathani is an independent technical analyst. Views expressed are personal).